Nilesh Shukla
The Government of Gujarat had set up a Task Force Committee in the month of February 2022 under the Chairmanship of Dr. Hasmukh Adhia, former Finance Secretary in Government of India for working out the strategy of Government of Gujarat for making India a USD 5 trillion economy as per the vision of Prime Minister of India. The Task Force Committee has already submitted its Final Report to Gujarat Chief Minister Shri Bhupendra Patel. The Committee has completed this big task within three months.
India intends to achieve the GDP target of USD 5 trillion by 2026-27 in nominal terms. In 2021-22, India became a USD 3.09 trillion economy in nominal terms. Average annual nominal growth for the last 10 years (2012-13 to 2021-22) is nearly 10.5 percent. Therefore, if the past growth rate is sustained, India would be a USD 5 trillion economy by 2026-27. Let us see what the Report says.
The target of a USD 5 trillion economy by 2026-27 is contingent on growth at the State level. Five states i.e. Gujarat, Tamil Nadu, Maharashtra, Uttar Pradesh and Karnataka constitute approximately 49 percent of the nominal GDP of the country. All five states have grown at an average annual nominal growth of nearly 10 percent or more during the pre-COVID period (2012-13 to 2019-20) and have the potential to continue to grow at a rapid pace in the coming years, if everything goes well. The contribution in the economy of big states like Bihar state is also important but unfortunately Bihar is not doing well in industry. There is a big scope in packaging and food industry in Bihar but somehow this state is not focusing in this sector even though production of vegetables and other agri products is higher than other states.
The central bank, major multilateral institutions and rating agencies released their latest FY22 real GDP growth forecasts for India. As per these forecasts, GDP growth ranges from 8.3% (World Bank) to 10% (ADB). These exceptionally high levels of growth do partly reflect a base effect since India’s GDP had contracted by (-)7.3% in FY21. The FY23 growth forecasts, therefore, indicate a more normal level of growth in the narrower range of 7.5% to 7.9%.
Taking a longer-term view, as per the October 2021 issue of IMF’s World Economic Outlook, the Indian economy is poised to become the global growth leader FY22 onwards. Not only does it overtake China amongst major economies in FY22, it is projected to retain this position for the next five years.
(Courtesy of Table-1 EY)
India is a big economy in the world after the US, Russia and China. Gujarat plays a key role to boost the Indian economy. PM Narendra Modi rightly says that Gujarat ka Vikas Desh ka vikas- Gujarat’s development for Nation’s development. Gujarat is a national leader in automobiles & auto-parts sector, pharma and medical devices, chemicals and petro-chemical, sanitary/ceramics goods, textiles, garments & apparel etc. Gujarat is also world’s largest petroleum hub, global leader in diamond processing (Surat), Asia's largest dairy (Amul). Gujarat contributions on all these sectors will help to boost the Indian economy. The country has to depend on Gujarat’s economy growth to achieve target of USD 5 trillion economy besides Maharashtra, Tamilnadu, UP and Karnataka. In next financial year picture will be more cleared whether nation will be able to achieve this target or not.
Writer is Joint Director in Gujarat Bhawan
