December 26, 2024
Themed “Maintaining India’s Growth Momentum Amid Global Uncertainty,” the meeting highlighted reforms in agriculture, taxation, and employment
Experts emphasised aligning education with market needs, enhancing infrastructure investment, and expediting free trade agreements to boost exports
Rural development and agricultural productivity were identified as critical for bridging the urban-rural economic divide
Policymakers stressed resilience through job creation, inflation management, and global trade integration to achieve developed nation status by 2047
India is strategising to achieve 7-8% economic growth amid global uncertainties, with discussions between Prime Minister Narendra Modi, economists, and policymakers taking centre stage at a high-level pre-budget meeting. The deliberations, themed “Maintaining India’s Growth Momentum Amid Global Uncertainty,” focused on key reforms to sustain growth and position India to meet its ambitious goal of becoming a developed nation by 2047.
India’s economic growth slowed to 5.4% in the second quarter of FY25, its weakest performance in seven quarters, attributed to challenges in manufacturing and mining. While retaining its status as the fastest-growing major economy, with growth outpacing China’s 4.6%, the slowdown has led to downward revisions in GDP projections. The Reserve Bank of India (RBI) now forecasts a 6.6% growth rate for FY25, while the State Bank of India projects 6.3%.
Policymakers and experts at the meeting underlined the need for reforms to sustain recovery and achieve robust growth. Recommendations included strengthening agricultural value chains for essential commodities and addressing climate change and energy transitions. Experts also proposed enhancing tax structures to spur investment and consumption, emphasising reforms in both direct and indirect taxes.
Infrastructure development was identified as a key driver of long-term growth. The discussions highlighted the need to mobilise public and private investments to expedite projects, generate employment, and boost economic productivity. Employment generation remained a priority, with participants advocating vocational training and education aligned with market demands to instil the dignity of labour.
Trade and exports emerged as another critical area, with calls for the swift finalisation of free trade agreements and measures to internationalise the rupee. These strategies aim to integrate India into global value chains, particularly as geopolitical tensions create opportunities to strengthen its position in trade and manufacturing.
Rural development was essential to bridging economic disparities between urban and rural areas. Proposals included enhancing agricultural productivity and creating sustainable employment opportunities in rural regions to support inclusive growth.
The Prime Minister reiterated the government’s vision of achieving developed nation status by 2047. Structural reforms, job creation, infrastructure expansion, and inflation management were highlighted as crucial to this goal. The meeting also noted that global geopolitical tensions, including a potential tariff war between the US and China, could provide India with new opportunities in trade and manufacturing.
The consultations brought together Finance Minister Nirmala Sitharaman, NITI Aayog Vice Chairman Suman Bery, and leading economists, including Surjit Bhalla, Ashok Gulati, and Ridham Desai. Together, they underscored the importance of balancing immediate economic challenges with building a resilient foundation for long-term growth.
Source: Economic Times