India’s Prime Minister Narendra Modi in his Independence Day speech announced that by 2024 the country aims to be USD 5 trillion economies. Soon after the announcement, opposition parties started taking a dig at Modi and said that it is impossible and it will remain a dream as the current economy of India going down.
The current economy of India is USD 2.7 trillion and by 2024 we have to double the number so we can hit the target. But the road to success is not so easy, as per the current economic crisis in India many economists have said that it is next to impossible. But our Finance Minister and entire Bhartiya Janta Party (BJP) is enormously confident that India will reach USD 5 trillion by 2024.
Talking about the opposition parties, they are leaving no stone unturned to slam the government for the current economic disaster. Former Prime Minister Manmohan Singh said there was no hope of the Modi government’s promise of USD 5 trillion economies becoming a reality if growth kept going down the way it has for the last five quarters.
He even said that at least one million people may lose their jobs if a stimulus package is not given to the auto sector, which is crying for aid, and investment in the private sector is not promoted.
He said the size of the economy was USD 2.7 trillion in the current financial year and to reach USD 5 trillion economies by 2024, the country needs a growth rate of 12 percent by the nominal terms and 9 percent in real terms.
The growth rate has declined for five successive quarters and now it stands at 5 percent, he noted, adding that the real wage rate in agriculture has been static for the last five years of the BJP government.
Singh said the manufacturing sector has been affected for want of demand, for want of investment incentives, and the result is that there is an all-round atmosphere of gloom.
However when there is hope there is life, some optimistic economists have said that this is still possible but for this India’s market needs to grow substantially In August this year, PTI cited the latest edition of Economy Watch, where Ernst & Young (EY) said India will need to grow by 9% every year for five years continuously and raise aggregate investment rate to 38 percent of GDP to achieve Prime Minister Narendra Modi’s target of a $5 trillion economy.
In its latest edition of Economy Watch, EY said assuming India grows by projected 7 percent in the current fiscal year ending March 31, 2020, the size of the economy will grow to $3 trillion from $2.7 trillion in the previous year. It will have to grow by 9 percent in each of the five subsequent years to take the size of the economy to USD 3.3 trillion in FY21, $3.6 trillion in FY22, $4.1 trillion in FY23, incremental capital-output ratio 4.5 trillion in FY24 and $5 trillion in FY25.
Though the dream of USD 5 trillion seems to be impossible after looking at current economic blunder, but it is achievable as per some economists but after the current situation is stable.