Indian economy poised to hit $7.3 trillion by 2030: Finance Ministry report

The Indian economy is projected to grow at a rate of more than 7 per cent in the coming years on the back of robust financial sector, structural reforms, demographic dividends and technological advancements. The Finance Ministry of India in a report has projected an optimistic economic growth trajectory, with the country's GDP expected to more than double from $3.5 trillion in 2022 to $7.3 trillion by the end of the decade.

As of January 29, the Indian economy has reported to be at $3.7 trillion, a marked growth from its position as the 10th larget economy a decade back with a GDP of $1.9 trillion. There is considerable potential for the economy to grow at a rate above 7 percent in the coming years. However, geopolitical conflicts remain a risk that could impact this trajectory.

''The strength of the domestic demand has driven the economy to a 7 per cent plus growth rate in the last three years...in FY25, real GDP growth will likely be closer to 7 per cent,'' said the review report, and added there is, however, considerable scope for the growth rate to rise well above 7 per cent by 2030.

The Finance Ministry credits this remarkable progress to a series of both substantive and incremental reforms that have not only contributed to economic advancement but also fortified the nation's economic resilience against unforeseen global shocks. These reforms are expected to continue propelling India towards its goal, with the ministry projecting a further increase to $7 trillion by 2030.

''Furthermore, under a reasonable set of assumptions with respect to the inflation differentials and the exchange rate, India can aspire to become a USD 7 trillion economy in the next six to seven years (by 2030),'' it said.

In addition to economic reforms, the government's investment in infrastructure has seen a substantial increase, rising from Rs 5.6 lakh crore in FY15 to an estimated Rs 18.6 lakh crore in FY24. This investment is part of a broader strategy to sustain and enhance economic growth, which has been robust over the past three years, with a growth rate of over 7 percent.

''This ten-year journey is marked by several reforms, both substantive and incremental, which have significantly contributed to the country's economic progress,'' it said.

The Finance Ministry's review report, led by Chief Economic Adviser V Anantha Nageswaran, acknowledges the challenges posed by global economic conditions, including supply chain disruptions that have resurfaced in 2024. Despite these challenges, the report maintains an optimistic outlook for India's economy, suggesting that real GDP growth could be close to 7 percent in FY25 and potentially rise well above 7 percent by 2030.

Furthermore, the government has set an ambitious target of transforming India into a 'developed country' by 2047, a vision that hinges on the continuation of reforms and full participation from state governments. The ministry emphasizes the importance of reforms at all levels of governance, including districts, blocks, and villages, to ensure they are citizen-friendly and supportive of small businesses.

''The government has, however, set a higher goal of becoming a 'developed country' by 2047. With the journey of reforms continuing, this goal is achievable,'' it said.

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