India should grow at least at a rate of 14-15 per cent in formal credit so as to achieve the $5 trillion economy goal, said a veteran strategist. There is almost a Rs 35 trillion shortfall to reach the target by FY25, Neelkanth Mishra, Managing Director and India Strategist, Credit Suisse said at 6th SBI Banking & Economics Conclave. India aims to achieve the target of becoming a $5 trillion economy by 2024. Speaking at the same event telecast by CNBC TV18, Sanjeev Sanyal, Principal Economic Advisor in the Ministry of Finance said that a $5 trillion economy assumes exchange rate of 75/$ by 2024.
For the economies standing at the same stage as India, the investment is the key driver of growth and consumption is the force multiplier, Chief Economic Advisor, Krishnamurthy Subramanian said through a video message. “This is important because at the macroeconomic level, every variable whether it is investment, consumption, demand, exports, these are both causes and effects – they are causes for some other macroeconomic variables while they are effects of other macroeconomic variables,” he added
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Taking stock of the economic slowdown, CEA said that the Modi government is focussed on tackling growth related challenges. It is taking all the needed steps to being the economy back on track, he added. Even though concerns related to slowdown are legitimate, but one should not be bogged down by excessive pessimism, he added.
India recorded a dismal GDP growth of 5 per cent in the first quarter of the ingoing fiscal, on account of slower growth in manufacturing sector. RBI, along with many other rating agencies have cut India’s growth forecast for the ongoing fiscal owing to weak demand and global slowdown.