India has the potential to rise as the world's second-largest economy by the year 2031, as stated by the deputy governor of the RBI

India has the potential to rise as the second-largest economy by 2031 and eventually claim the top spot globally by 2060, as stated by Reserve Bank Deputy Governor Michael D Patra.

In his speech to the officials of the Indian Administrative Service at Lal Bahadur Shastri National Academy of Administration, Mussoorie, it was highlighted that India must navigate challenges related to labor productivity, infrastructure, the manufacturing sector's contribution to GDP, and the transition to a greener economy for sustainable development.

"With the innate strengths outlined and a steadfast commitment to achieving its ambitious goals, India has the potential to emerge as the world's second-largest economy not by 2048, but as early as 2031, and ultimately claim the title of the largest economy by 2060," stated the senior RBI official. Furthermore, it has been projected that if India sustains a growth rate of 9.6% annually over the next decade, it will successfully break free from the constraints of the lower-middle-income bracket and transition into a fully developed economy.

"These gains need to be reflected in per capita income with two milestones–a per capita income level of $4516-14,005 to reach middle-income country status, and beyond that level to attain the position of a developed country today. By 2047, however, the developed country threshold will have moved up to $34,000," he said.

He mentioned that the fluctuating exchange rates in the market can experience periods of instability. Therefore, using them as the basis for GDP calculations in national currencies might not be suitable for comparing different countries.

Another way to measure economic strength is through purchasing power parity (PPP), which reflects the cost of a standard basket of goods and services in different countries. According to Patra, when using PPP, India emerges as the world's third-largest economy. By 2027, the projected $5 trillion milestone equates to a staggering $16 trillion in PPP value.

The Organisation for Economic Cooperation and Development (OECD) projects that, in PPP terms, India will overtake the US by 2048 to become the second largest economy of the world.

At end-March 2024, India had become a Rs 295.4 lakh crore or $3.6 trillion economy at current exchange rates. At a per capita income of Rs 2,07,030 or $2,500, India belongs in the lower-middle-income group of countries.

Patra was speaking on 'Future Readying India's Monetary Policy'. He said the principal task of the monetary policy is to become the anchor of the Indian economy. Short-run fluctuations of aggregate demand have to be managed proactively so that a broad alignment with the economy's evolving productive capacity is ensured.

"Ensuring price stability through monetary policy is key to building a strong foundation for sustained growth in the coming decades," he emphasized.

He highlighted the importance of aligning India's inflation rates with global trends to safeguard the internal and external value of the rupee. This strategic move will pave the way for the rupee's internationalization and position India as a leading economic powerhouse in the future world.

*************************

TheTalkStreet  is an innovative online digital magazine that amplifies the voices of Entrepreneurs, Bloggers, Celebrity, Startups, Trend setters, Influencers, Peoples, Social empowerment and more. Through our website and social media platforms, we share compelling stories and conduct insightful interviews to connect with our diverse audience. Additionally, we strategically run advertisements across various platforms to help you generate valuable leads.

Embrace the opportunity to showcase your journey, achievements, and vision, establishing you & your brand as a leader in your industry. Join www.thetalkstreet.com , to inspire, engage, and connect with a global community eager to embrace innovative ideas and transformative experiences.

If you have a compelling story to share with our readers, please reach out to us at hello@thetalkstreet.com We will carefully evaluate your submission and may extend an invitation to feature it if it meets our publishing standards.