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Informist, Friday, Feb. 28, 2025

 

NEW DELHI – India must accelerate its reforms process if it wishes to become a high-income nation by 2047, with real GDP growth averaging 7.8% every year until then, according to the World Bank. Only an "accelerated reforms package" would put India on track to achieve its aspiration of becoming a developed country, it said. This package would require investment rising to 40% of GDP by 2035, female labour force participation rate increasing to 55% by 2050, and total factor productivity growth peaking at 3.1-3.2% by the start of the next decade, the multilateral organisation said.

 

"Under 'business as usual', India will experience tangible welfare gains but still fall short of its ambitions. If the reform pace was to slow down significantly over the coming decades, India would fall short by a wide margin. Only an 'accelerated reforms' package, would put India on track to become High-Income by 2047," the World Bank said Friday in a report, listing out three possible scenarios for the Indian economy. As per the baseline case, India's GDP growth will average 6.6% for the next couple of decades.

 

India's GDP growth has averaged 6.0% per year starting 2012-13 (Apr-Mar), as per available data.

 

The World Bank report comes hours before the Indian statistics ministry releases GDP data for the third quarter of FY25, with economists polled by Informist predicting growth to have risen to 6.3?ter crashing to a seven-quarter low of 5.4% in Jul-Sept. As per the ministry's first advance estimate, released in January, India's growth is seen falling to a four-year low of 6.4% this year. This figure is likely to be revised later on Friday when the statistics ministry will release the latest GDP data at 1600 IST.

 

Some of the reforms recommended by the World Bank in its report include improving the digitisation and quality of land records, improving agricultural productivity, facilitating labour mobility by strengthening the 'One Nation One Ration Card' scheme, further improving learning outcomes, enhancing expenditure efficiency, strengthening bad loan resolution mechanisms, improving non-banks' access to long-term funding, addressing barriers to foreign direct investment, creating conditions for more and better jobs, and facilitating states to grow together, among others.  End

 

Reported by Siddharth Upasani

Edited by Ashish Shirke

 

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