Reforms transforming India, country needs manufacturing, exports to fire up for long-term 8-9% growth: Kant

New Delhi: Structural reforms, a massive digitization drive and government’s scaled-up capital expenditure are driving India’s economic transformation, but sustaining 8-9% growth over multiple decades would require India’s manufacturing and exports sectors to performing better, India’s G20 Sherpa Amitabh Kant said at the Mint India @2047 summit here.

India is now building about eight airports a year, about three metros a year, building about 30 kilometres of road and 12 km of railway line a day, Kant said in his keynote address about ‘realizing the great Indian dream’ of becoming a developed nation.

“So that has been the scorching phase of infrastructure creation,” Kant said, adding that India has taken the responsibility of taking leadership in energy transition although it did not occupy a big space on carbon footprint.

India has plans to move from renewable to green hydrogen and become a chief producer of green hydrogen, Kant said. “Our aim is that by 2047, we should be the biggest producer and the largest exporter of green hydrogen.”

India must achieve GDP of $30 trillion by 2047

But if the country has to realize the great Indian dream, the vision of being ‘Viksit Bharat’, it must achieve a GDP of $30 trillion by 2047 and it must take the per capita income from about $2,700 to close to $18,000, according to Kant. “And that means that the GDP must grow by nine times and per capita income must grow by eight times. And this implies that manufacturing has to grow by 25 times.”

Very few nations in the world have been able to do this. Post World War II, Japan did this and much later, Korea and Taiwan did it. And in recent times China has achieved this, said Kant.

He explained that India’s investment rate has to rise very sharply from about 31% of the GDP to 40%, which calls for savings rate to further improve. Private capital expenditure has a big role to play in investment rate going up, Kant said.

To realize the great Indian dream, the nation cannot merely rely on a few performing states like Tamil Nadu, Gujarat, Karnataka or Maharashtra. “You cannot have some states grow at very high rates and the rest of India grow at two to 3% … Therefore, we need champion states in India. You need Bihar, Jharkhand, Chhattisgarh, Haryana and Rajasthan to grow at rates of 10-11%.”

Prime Minister Narendra Modi had discussed the goal of making India a developed country with state chief ministers at the NITI Aayog governing council meeting on 27 July. Modi then stressed on the crucial role of states in driving their own development, and asserted that India achieving developed nation depended significantly on the progress of individual states. He also told chief ministers to create their own vision documents and to pursue tangible goals.

The Prime Minister is also keen to attract more foreign investments and has also asked the federal policy think tank to develop an ‘investment-friendly charter’ detailing the policies, programmes, and processes needed to attract investments, Mint had reported on 27 July.

Kant said top-class planning for urbanization, improved learning and health outcomes and greater active participation of people was needed to make India an advanced economy.

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