Vantage | What India must do to be a $7 trillion economy by 2030

As the Indian government gears up to present the annual budget in what is considered the last one ahead of the general election, the focus is on maintaining stability with an interim budget. While no significant announcements are expected during this period, New Delhi has sent out signals and set ambitious targets for the economy’s future.

In the next three years, India aims to secure its position as the world’s third-largest economy, targeting a GDP of $5 trillion dollars. Looking ahead to 2030, the goal is to add an additional $2 trillion to reach an impressive seven trillion in seven years. This ambitious target not only demonstrates confidence in the current leadership’s economic management but also serves as a sign of optimism. Despite being an interim budget, the government has set lofty targets, indicating a belief in its ability to steer the economy in the foreseeable future. Projections for India’s growth trajectory are optimistic, with the Central Bank of India estimating a 7 per cent growth rate in 2024. The finance ministry goes even further, aiming for growth beyond 7 per cent. In 2025, the finance ministry predicts a sustained 7 per cent growth rate, supported by various reports and projections. If India can maintain this momentum, it stands a chance to achieve the ambitious economic targets set for itself. However, amidst these aspirations, challenges loom on the horizon. The finance ministry’s report identifies three key trends that could shape India’s economic landscape: de-globalization, artificial intelligence, and energy transition. De-globalization, the opposite of globalization, implies a less interconnected world. The idea is to diversify supply chains and reduce dependence on specific countries. While India sees no immediate risk, the slow process of supply chain alternatives emerging requires a proactive approach. With several countries vying for the same market, India must stay competitive by investing in lowering logistics costs and improving production quality. The second challenge is artificial intelligence, which poses a risk to the Indian service sector, a significant contributor to the country’s GDP. As AI adoption grows globally, there are concerns about its impact on job creation and the services trade, especially in the IT sector where India holds a substantial market share. The third challenge is the transition to green energy as global pressure mounts to move away from fossil fuels. While this transition is beneficial in the long run, it poses short-term challenges that could slow down economic growth. Striking a balance between growth needs and environmental obligations becomes crucial for India in this context. In conclusion, India’s policymakers are actively working on addressing these challenges. As the budget day approaches, observers await to see if Thursday’s budget will lay the foundation to tackle these issues and set the stage for India’s economic future. Stay tuned for updates on how India plans to navigate these challenges and fulfill its ambitious economic goals. Views expressed in the above piece are personal and solely that of the author. They do not necessarily reflect Firstpost’s views. Read all the Latest News, Trending News, Cricket News, Bollywood News, India News and Entertainment News here. Follow us on Facebook, Twitter and Instagram.