Indian economy's size to double by FY31, growth to average 6.7%: S&P Global

economictimes.indiatimes.com:

economy to average 6.7% growth between FY24 and FY31 and double the size of the economy to $6.7 trillion within the next eight years, S&P Global Ratings stated in its report released on Thursday. S&P stated that India can capitalise on this moment when the world faces unprecedented transition and uncertainty.

It forecasted India’s per capita GDP to increase to $4,500 by FY31. It further pointed that geopolitics can provide potential tailwinds for India’s growth efforts.

“The macro challenge for India in the upcoming decade is to turn traditionally uneven growth into a high and stable trend,” noted Paul Gruenwald, Global chief economist S&P Global Ratings. “We expect the Indian private sector to gradually increase investments given healthy corporate balance sheets,” S&P Global said, further pointing that growth from productivity contribution will be higher due to the “creation of physical and digital infrastructure in conjunction with efficiency-enhancing reforms.” The global rating agency expects capital to contribute 53% of India’s average GDP growth, with productivity driving 30% of GDP growth.

Experts noted that India needed to do more in terms of labour force participation federalism and lifting private investment in manufacturing to create conditions for sustained growth. “India’s path to becoming a more influential global actor will be determined by how effectively it can manage its federalism balancing act and mobilize the participation of grassroots interests,” said Deepa Kumar, Head of Asia-Pacific Country Risk, S&P Global Market Intelligence.