India to become a US$ 3 trn economy by 2023 fiscal: CEA

The Chief Economic Advisor (CEA) also expects the country to become a US$ 7 trillion economy over the next seven years

January 13, 2023

Some of the reasons aiding this growth are China opening its markets after 2 years of the pandemic and the U.S. poised to lower its interest rates

The National Statistical Office (NSO) has predicted that the economic growth of the country in 2022-23 will be 7%

The government had previously said that the country would turn into a US$ 5 trillion economy by 2025

The realistic medium-term growth rate stands at 6.5%

The Indian economy is expected to become US$ 3 trillion by the end of the 2023 fiscal and US$ 7 trillion over the next seven years, according to Chief Economic Advisor (CEA) V. Anantha Nageswaran. 

On the other hand, the government had previously said that the country would turn into a US$ 5 trillion economy by 2025.

Some of the reasons aiding this growth are China opening its markets two years after the pandemic and the U.S. is expected to lower its interest rates in 2024 or 2025. Other contributory factors include the growth of the advanced economies of the US and Europe. According to media reports, the National Statistical Office (NSO) has predicted that the country’s economic growth in 2022-23 will be 7% in real terms and 15.4% in nominal ones. 

Nageshwaran said that the realistic medium-term growth rate stands at 6.5%. Furthermore, structural reforms taken by the government such as implementing the Goods and Services Tax (GST) and Insolvency and Bankruptcy Code, and initiatives such as Jan Dhan accounts have developed a positive growth outlook for the country. 

Additional contributory factors include corporate sector borrowing, private capital formation, and banks with lower NPAs willing to lend. Media reports also said that improvements in digital infrastructure have the potential to contribute 0.2 to 0.5% of the country’s GDP. 

Source: The Hindu

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