A look at India's potential GDP growth in the years ahead
Upstox
2 min read • Updated: February 24, 2024, 4:32 PM
Summary
World Data Labs said that India’s consumer market is growing at a rate of 46%. India may not be a developed country yet but it has the fastest growing economy. Other large economies like China and USA are facing the problems of an ageing population. But India with its median age of 28.2 years, is far from slowing down in its growth trajectory.
Expectations from the economy in the coming years
The Finance Ministry predicts that India could become the world's third-largest economy in the course of the next three years, with a gross domestic product (GDP) of $5 trillion and reach $7 trillion by 2030. This prediction is based on ongoing reforms in India that have greatly contributed to the country's economic growth.
The administration has set a more ambitious target of being a ‘developed country’ by 2047. This goal is expected to be achieved as the reform process continues. The reforms are said to be more effective with the full engagement of state governments. This includes improvements in governance at the district, block, and village levels, thus making them more citizen-friendly and small-business-friendly.
In the last three years, the economy has grown at a 7% rate or higher due to robust domestic demand. It is also emphasized that real GDP growth will most likely be closer to 7% in FY25, with plenty of room for the rate to reach significantly higher by 2030. Furthermore, given the strength of the financial sector and other recent and upcoming structural changes, the Indian economy has a good chance of growing at or above 7% in the next years.
Regulatory changes to advance GDP
Regulatory changes that can improve a country’s GDP growth. To boost GDP growth, regulatory changes can focus on creating a more favourable environment for business growth and investment. This could include streamlining bureaucratic processes and adopting laws that promote innovation and entrepreneurship. Plus, there can be a focus on improving infrastructure and encouraging long-term economic development. Regulatory reforms may seek to encourage
Foreign direct investment (FDI) by streamlining entry and exit procedures and strengthening investor protection. A favourable regulatory environment can indeed boost economic growth and productivity. Finally, these improvements are intended to boost economic activity and provide new job possibilities. This in turn improves economic well-being.
Conclusion
In recent years, our country has faced many challenges in various sectors. However, economic policies that sustain inclusive growth have helped us in the growth path. The Indian economy growth is estimated to be driven by domestic demand and financial sector reforms. Hence, India can aspire to be a $7 trillion economy by 2030.