India’s economy is on course to become the third-largest in the world by 2027, driven by policy consistency and a series of transformative reforms, according to BVR Subrahmanyam, CEO of NITI Aayog. Speaking at a special industry interaction hosted by ASSOCHAM, Subrahmanyam emphasized that India’s contribution to global economic growth is already around 20% and is expected to rise further in the coming years.
“India is one of the shining stars on the global economic horizon today,” Subrahmanyam said. “With a growth rate of 8.2% for the last fiscal year, and poised to become the third-largest economy by 2027, we are on a remarkable growth path. Our share of incremental global growth has already reached 20%, and this will only increase in the future.”
Reforms Driving India’s Economic Transformation
Subrahmanyam traced India’s economic revival to the liberalization of the 1990s, which he said unlocked significant potential within the country’s workforce. However, he pointed out that the real shift in India’s economic fortunes began in the last decade with a fresh wave of reforms.
“Earlier, reforms in India were incremental and often covert,” Subrahmanyam explained. “But in the past 10 years, we’ve seen a dramatic shift. Reforms like the introduction of GST, the creation of the Insolvency and Bankruptcy Board, and a focus on digital infrastructure have made doing business in India significantly easier.”
He also highlighted India’s demographic advantage as a key asset for the future. “With the world’s largest population, India is positioned to become the global hub for manufacturing and services, especially as the global workforce begins to shrink. This demographic dividend will fuel our economic growth for the next century.”
Green and Sustainable Growth for ‘Viksit Bharat’
While praising the progress made, Subrahmanyam noted that India is still in the early stages of realizing its full economic potential. “We are currently operating at just 10% of our true potential,” he remarked. “To achieve our goal of becoming a developed nation by 2047, India must remain a ‘construction site’ for the foreseeable future. But the India we build must be green, sustainable, and integrated with global and domestic finance systems.”
He also pointed to the government’s enhanced focus on capital expenditure (capex), which has risen from a GDP ratio of 1.4% to 3.2% over recent years. “This shift is crucial in driving the infrastructure development necessary for long-term growth,” Subrahmanyam said. “India has made impressive strides, and I believe we can absolutely achieve the ambitious goals we’ve set for 2047.”
MSMEs Play a Critical Role
Another major highlight of Subrahmanyam’s address was the importance of Micro, Small, and Medium Enterprises (MSMEs) in India’s economic progress. “MSMEs are vital to our economy, accounting for nearly 40% of our exports,” he noted. “The credit guarantee scheme for MSMEs has been a lifeline for many businesses, especially post-COVID, and I believe it should be extended to ensure continued growth and recovery.”
Digital Transformation and Financial Strength
Sanjay Nayar, President of ASSOCHAM, also took the stage to underscore the role of policy consistency in India’s economic rise. He noted the positive momentum in the real estate sector, which he said is a key indicator of broader economic growth. “The government’s push for digitization has been particularly impactful, ensuring that subsidies and reforms reach the people who need them the most,” Nayar said.
He also pointed to the robust health of India’s financial sector, with stronger banks and a thriving stock market, where foreign investor participation has increased significantly.
“India’s financial institutions are stronger than ever, and the stock market is performing well,” he said. “This has instilled confidence in both domestic and international investors, which bodes well for the future.”
A Bright Economic Future
Both Subrahmanyam and Nayar agreed that India is on the right track, but challenges remain. As Subrahmanyam aptly put it, “India is only 10% of its potential right now, but with continued reforms, infrastructure development, and a focus on sustainability, we can build a prosperous, developed nation in the next few decades.”
With the government’s ongoing policy focus and structural reforms, India’s path to becoming a global economic powerhouse by 2047 seems increasingly assured.
