India's next phase of growth must focus on per capita GDP: Report
New Delhi: India has overtaken several economies in terms of GDP over the past decade, but its citizens' per capita income remains poor. In that context, a report by Llama Research suggested that the next phase of India's growth must translate into individual prosperity.
Manufacturing scale-up, digital formalisation, and rising income tiers are some of the reasons that are at India's advantage.
Noting that India ranks the lowest on per capita income among the top 10 economies, Llama Research asserted, "This isn't a flaw, it's a window of compounding potential."
Tech savvy population, solid policy, room for long-term capital formation, and macro stability are some other positives for India, according to the report.
"India is not just rising in rank, it's building the foundations to lead from the ground up," Llama Research said in the report 'India's growth: Journey from size to strength'.
To realise the vision of 'Viksit Bharat', a developed nation dream by 2047, India will need to achieve a growth rate of around 8 per cent at constant prices, on average, for about a decade or two, the Economic Survey document for 2024-25 tabled on January 31 asserted.
India has made quite a turnaround, climbing the ladder of economic growth. This can be gauged from the 11th in 2013-14, India has positioned itself to become the fourth largest economy. Even as India has overtaken many countries in terms of the size of the economy over the past decade, the per capita income in India remains very low.
In 2013, India was placed in the league of 'Fragile 5' economies. The term 'Fragile 5' was coined by a Morgan Stanley analyst and refers to a set of five emerging countries, including India, whose economies were not doing well. The other four countries were Brazil, Indonesia, South Africa, and Turkey.
Currently, India is the fifth largest economy, and among the fastest-growing major economies. It is projected to remain so over the next few years, as many global agencies have anticipated.
In the current financial year, India is set to overtake Japan to become the world's 4th largest economy, as projected by IMF.
As was widely expected, the Indian economy grew by 6.5 per cent in real terms in the recently concluded financial year 2024-25. In 2023-24, India's GDP grew by an impressive 9.2 per cent.
According to official data, the Indian economy grew 8.7 per cent and 7.2 percent, respectively, in 2021-22 and 2022-23.
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