India looks at close to double digit growth this year: FM Mrs. Sitharaman

India is expected to near double-digit growth in 2021 and the country is projected to be one of the fastest-growing economies according to Finance Minister Mrs. Nirmala Sitharaman.

The minister also stressed that she expects the economic growth next year to be in the range of 7.5-8.5%, which will be continued for the next decade.

Mrs. Sitharaman said during a conversation at Harvard Kennedy School “As regards the growth of India, we are seeing at near close to double-digit growth in 2021 and this would be the highest in the world. And for 2022, on the basis of this year, growth would certainly be somewhere in the range of 8%”.

She stated that while the Ministry of Finance has not done any calculation as yet about the growth number, but the World Bank, IMF and other rating agencies have all come closer to this kind of growth number for India.

She added further that some other countries in the emerging market areas will also record high growth rates.

When asked about the sustained growth of 8%, a historical rarity, her medium and longer term vision of where that growth is going to come from, Mrs. Sitharaman emphasised that she does not think the growth of any country post-pandemic can be associated with what had happened earlier, prior to the pandemic.

“The change which the globe has seen itself tells explains the narrative that the way in which countries are setting out to plan their growth will be very different from what it was earlier,” she added.

She noted that the COVID-19 pandemic is one of the reasons for the change, which is “happening from few geographical territories where public is coming out of it, looking for other places where they can do their businesses”.

“Hence, the industry is the first one to come out. Investments are the first ones to come out and they are seeing for destinations where certain assumptions can be taken up - rule of law, democracy, transparent policies and assurance that they are with a broad global frame of things and that you are not an outlier, that you will not have anything to do with the global scheme of things, and it's no good for us.” The minister stated all these are extraneous factors that helped India to attract industries to set businesses there.

She also indicated that India itself is a huge market.

“Today, India’s demographic dividend is not a dividend without reason. It's a dividend, which has huge purchasing power ability. The middle class in India has the money to buy things,” she stated, adding that the people who are relocating from other destinations to invest in India and to produce in India will have a captive market.

“The same demographic dividend also gives the country another advantage - the youth population of India today is a skilled set of youngsters skilled in various different areas, most of them in STEM,” the minister added further.

Mrs. Sitharaman stated that India will attract investments and have the purchasing power to demand the best of things from whoever creates it.

India is still best in agriculture. “The food security of several countries depend on imported food. Lots in the Middle East depend on India for their basic food materials. We will be one of the largest exporters of food and food processed materials,” she added further.

Correspondingly, labour intensive units, partly-skilled labour-intensive sectors such as textile, footwear, leather, and certain parts and components for the industry are majorly manufactured in India. “So, I see every reason to believe that this 7.5 to 8.5% growth is definitely sustainable for the next decade. These are elements that don't exist in any one country all put together. You may have one in one country, and the other in a different country. But India has it all,” the minister stated.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.