Finance Minister Nirmala Sitharaman on Wednesday expressed confidence that India will be the third largest economy in the world with a gross domestic product (GDP) of over $5 trillion by 2027-28.
At the end of 2022-23, the Indian GDP stood at $3.7 trillion, and its economy is now the fifth largest in the world. The International Monetary Fund (IMF) has projected India to become a $5 trillion economy with the third-largest GDP in 2027-28, by overtaking Japan and Germany.
“It is possible that we will be the third largest economy by 2027-28, and our GDP will cross $5 trillion by that time. By 2047, it is a conservative estimate that we will reach at least $30 trillion in terms of economy,” Sitharaman said while addressing a seminar of Vibrant Gujarat Global Summit 2024 at Gandhinagar.
During the Amritkal, which will mark 100 years of India’s Independence in 2047, emphasis is being given to sunrise industries, the minister said. The liberal foreign direct investment (FDI) policy of the Centre has helped attract foreign investment, with $595 billion coming in the last 9 years.
Stressing that the people of India have met with the challenges post-Covid and recovery is on a strong footing, she said Gujarat will be one of the engines of growth in India’s march to become a developed economy by 2047.
Despite having 5% of India’s population, Gujarat contributes 8.5% to the country’s GDP. It is rapidly moving forward at 12% compounded annual growth rate between 2011 and 2021 against a national average of 10.4%, the minister said.
Between April 2000 and March 2023, in 23 years, India has attracted $ 919 billion in foreign direct investment (FDI), 65% of this has come in the last 8-9 years, Sitharaman said.
“FDI is coming in… where policies bring in greater certainty, convenience, ease of doing business, FDI flows in. Of course, disruptions of higher US Fed rate and other things can divert it elsewhere. But despite that, we have been receiving (high) inflow of FDI. It is not as if it’s coming only for manufacturing, it is coming in the service sector (as well),” she said.
Sitharaman said India is on track to become an in-house producer of semiconductors, and EV adoption is happening in a big way. All of these are the result of the FDI policy being pursued by the government.
Speaking about financial inclusion, Sitharaman said 80% of people have bank accounts. The number of bank account holders increased to 50 crore from 15 crore in 2014.