Can India become a $5 trillion economy by 2024?

can India become $5 trillion dollar economy

Context:

  • The present government of India has set a target to make India a $5 trillion economy by 2024. So, there are debates on whether this goal is achievable or not.
  • India’s GDP in 2018 was $2.73 trillion dollars.

Yes, India can become a 5 trillion dollar economy by 2024:

  • Ease of doing business has improved drastically in recent years. India ranked 77 in the World Bank’s Ease of doing the business index of 2018. India’s rank was 130 in 2016. This improvement helps in the growth of the economy.
  • In Budget 2019, 100 lakh crore rupees were announced for infrastructure over the next 5 years. This will create lots of employment opportunities and will improve the transport sector. So, this will, in turn, improve the economy.
    Reserve Bank of India has announced interest rate cuts, which means EMIs will get cheaper. So, this can result in more purchases by the public by taking loans and thereby increases money circulation.
  • Recently, on 23rd August 2019, Finance minister Nirmala Sitaraman announced some support measures for the economy. In this announcement, steps were taken to support the auto industry. It was also announced that Rs.70,000 crores will be infused to banks so that banks will be able to issue fresh loans. This will eventually help in economic growth. So, this gives us hope that the government is actively taking steps to achieve the goal.
  • Our Finance Minister Nirmala Sitaraman has promised to bring more reforms in the coming days to improve economic growth and thereby to make India a 5 trillion dollar economy by 2024.
  • Reserve Bank of India is transferring Rs. 1.76 lakh crore surplus funds to the government. This helps the government to invest money in several sectors and bring economic growth.

India may not become a 5 trillion dollar economy by 2024:

  • At present India is facing an economic slowdown. In the April-June quarter, India’s GDP growth was just 5.7%. To become a $5 trillion economy, India’s GDP growth should be at at least 8%, and nominal GDP growth should be at least 12% (Nominal GDP growth means Real GDP growth plus inflation). But considering the present circumstances, it is very difficult for India to achieve that growth. Recently, Moody’s Investor service revised India’s GDP growth to 6.2% from 6.8%. Even 2019’s Economic survey predicted this year’s GDP growth as 7%. So, if we take these things into consideration, it seems highly impossible to achieve the goal of making India a 5 trillion dollar economy in the next 5 years.
  • Because of the economic slowdown in India, foreign investors pulled out approximately Rs.8,300 crore in August 2019 alone. Already there is a lack of private investment and also a domestic investment. So, it may take so much time for the Indian economy to recover.
  • Many sectors are reporting slow growth because there is low demand for goods and services. This is reducing the circulation of money and resulting in more unemployment, which in turn reduces the demand for goods. So, right now India is caught up in this vicious cycle. Working on these things and making India a 5 trillion dollar economy at the same time seems impossible.

What needs to be done:

  • The government should focus on inclusive growth to achieve the goal rather than just focusing on increasing the GDP. Because in India, income inequality is very high. So, if the rich get richer and the poor became even poorer, a 5 trillion dollar economy will be no use to the common people. So, the government should take steps to improve the income of common people. It should take effective steps to create a large number of employment opportunities, to simplify GST and to bring structural reforms. It will increase the money at hand for common people, which will result in the purchase of more goods and services and will eventually improve our economy. And then even if India may not achieve the goal, it will be successful because there will be happier people.

Conclusion:

Having a goal is definitely a good thing because it encourages the government to take steps in that way. Becoming a 5 trillion dollar economy by 2024 is an achievable goal for India. But considering the present circumstances, it seems impossible to achieve it. However, we have 5 years at hand. So if the necessary reforms are brought, there is a possbility that India will achieve the goal.

 

Your Turn…

Do you think India can become a $5 trillion economy by 2024? Express your thought through the comment section below. And subscribe to our blog to read answers to the trending GD topics.


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7 comments

  1. By seeing current economical situation there is very less chance that india can become 5 trillion dollar economy..As economy is going through slowdown..there is fear among people of loosening the job..and all are spending less and saving for future and as we all know india is consumption based economy so it is worsening the situation more..there is less demand in every sector..Automobile and real estate industry worsly hitted..Govt. are taking several measures to boost the economy but all are not changing the ground situation..To become 5 trillion economy..india should increase its exports and india have to become manufacturing hub..As govt. is running the skill india campaign..skilled youth is required to boost the gdp of india..

  2. To be a 5 trollion economy, indian govt firstly boost a confidence among buyers bcz idian economy is a consumption based economy as of present conditions are that no one is willing to spend money as everyone has a fear of loosing job. And for me figures are not as important as actual reality is raising education level, health level, per person income is more important

    1. There is no longer impossible to achieve 5 trillion dollars economy by 2024 because , Indian has done many more economic reforms to be good rank in the world .We have sufficient time period for making equality in the income of common people with standard of living.

  3. Yes, india can become 5 trillion dollar economy by 2024 despite having poor economy at present. Since, certain measures have been taken by the govt to balance the economy obviously something better is going to come out and according to today’s scenario where everything is digitalised their are comparatively less chances of money being grabbed by the mediocres. And ,then certainly govt has runned many of the programs for the start ups and youth betterment . Since youth is the future of.this developing nation it’s their.turn to prove themselves rsther than sitting and saying what govt is doing. Govt is doing on their level wsy much and then it cones to us to perforn our duty. India’s relations with her neighbors( keeping pakistan aside) or overseas has improved so much that trading is not that difficupt now. If we consider trade war between China and USA and taking benefit of that then it’s not that difficult to jmprove our trading business. And that’s certainly going to help the economy. Now moving on to tourism factor, the most active part responsible for economy if we promote our own states keep them clean and also respect our guests (tourists) will they not think of coming again to our place?? Then comes the hot cake of the news i.e abrogating of article 370 now whole india has a chance to develop its own state by going their and generating new factories or jobs or something . This step will not only develop economy but will also make people of that state feel integrated to the whole nation which was not like that before . Now, switching to agricultural sector. We knoe its the major sector of our economy. If we take the responsibility of it rather than backing up on govt all.the time we can improve it. We know farmers burn off their crop residuals after harvesting ( cotton rice wheat etc.) . Instead of burning them they can be reused ethanol can be extracted from them which is an ecofriendly fuel and is cheaper. This kethod will not only help farmer to have an addictional income but will also help in redicing pollution. Now thinking it economically.more factorids will be set up for making ethanol that means more employment more money thus it will help in economy..like this their are various minor methods which if we take on our front will definitely open a way for achieving our target of 5 trillion dollars economy till 2024. For the betterment of our nation our families ourselves we ourself will have to make a move instead of cursing others or waiying for others to do.something.

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