While India is on course to become the fifth largest economy in 2019 by pipping United Kingdom, Narendra Modi-led-BJP has committed to make India the world’s third largest economy by 2032. Notably, BJP’s manifesto states that it commits to make India a $10 trillion economy by 2032. According to world bank data, India’s GDP currently stands at about $2.6 trillion. Notably, India surpassed France in 2017 to become the world’s sixth largest economy.
“We have already become the world’s sixth largest economy and will soon be among the top five. We aspire to make India the third largest economy of the world by 2030. This implies that we commit to make India a US $ 5 trillion economy by 2025 and US $ 10 trillion economy by 2032,” said BJP manifesto.
According to a recent PWC report, India and France are likely to surpass the UK in the world’s largest economy rankings in 2019, knocking it from fifth to seventh place in the global table. In 2017, UK had a total GDP of $2.62 trillion, about $25 billion higher than India. “India was branded as ‘fragile five’ in 2014. Within five years, we have turned India into a bright spot that is not only the fastest growing major economy of the world but also enjoys macroeconomic stability,” noted the manifesto.
Sharing the roadmap for transforming India into the world’s third largest economy, the BJP manifesto had several commitments relating to easing of tax policies, lowering GST rates, a Rs 100 lakh crore investment in infrastructure by 2024 and making India a global manufacturing hub, among others. We take a closer look.
With improved compliance and increased tax base, the tax to GDP ratio has reached 12%, highest in the recent past, up from 10.1% in 2013-14, said the manifesto. “This increased revenue has been deployed for benefits to the poor and creation of infrastructure at an unprecedented level. We will continue with our policy in the similar manner – lowering of tax rate thereby rewarding honest tax payers and improving compliance,” said BJP.
Rs 100 lakh crore infrastructure investment
BJP said that by 2024, a capital investment of Rs 100 lakh crore will be made in the infrastructure sector. “We recognize that investment driven growth requires cheaper cost of capital. By anchoring ination at 4% and cleaning up our banking system we have created the space for structural reduction in the cost of capital. This will not only help infrastructure investment but investment also in the wider economy,” said the manifesto. Therefore, new India will be built on the basis of investment driven growth.
Make In India
While India has made rapid progress in World Bank’s ‘Ease of doing business,’ BJP said that it commits to take India ranking in the top 50. Further, the government also seeks to strengthen companies act, and bring in a new industrial policy to improve competitiveness of manufacturing and services. The party promises to transform India into a global manufacturing hub.
Noting the steps taken so far, BJP said that a special package was launched by the Government to boost the MSME sector. “The Credit Guarantee Scheme of the Government of India is an important component wherein loans to MSME are guaranteed. Under this alone, the credit of around Rs 19,000 crore was achieved in 2017-18. We would aim to take this figure to Rs 1,00,000 crore by 2024.
Entrepreneurship and Startups
The manifesto also promised a new scheme to provide credit to startups. “To encourage the spirit of entrepreneurship amongst the youth, we will launch a new scheme to provide collateral-free credit up to 50 lakh for entrepreneurs. We will guarantee 50% of the loan amount for female entrepreneurs and 25% of the loan amount for male entrepreneurs,” said the manifesto.
Apart from the above, the manifesto also had several promises relating to tourism, international trade, urban development, Swachh Bharat, Jan Shakti, Road Connectivity, Energy and Digital Connectivity.