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Indian reforms bearing fruits

2018-19 GDP at 7.4%; 2025: US$5trn economy

World Bank

India expects gross domestic product (GDP) growth of 7.4% in 2018-19 as the economy has turned in a resilient performance in 2017-18, gaining from reforms.

Being the fastest growing economy in the world, India also expects to be US$5 trillion economy by 2025.

These strong economic outlook, potential and scope was presented by India’s senior economic executives at the World Bank in Washington on 21 April 2018.

Reserve Bank of India Governor Urjit Patel told the International Monetary Finance Committee “The Indian economy turned in a resilient performance in 2017-18.”

There was a strong rebound in the second half of the current fiscal year on the back of a turnaround in investment demand, he said.

India’s real GDP growth is seen at 6.6% in the current fiscal year, off from 7.1% a year ago.

Economic Affairs Secretary Subhash Chandra Garg said “India is poised to remain as the fastest growing large economy in the world.

“In 2018, we expect India to grow at over 7.4 per cent,” Garg told the 97th meeting of the Development Committee of the World Bank in Washington.

“India’s GDP is expected to reach a volume of US$5 trillion by FY2025 by leveraging on digitisation, globalisation, favourable demographics and structural reforms,” he said.

Garg is representing Finance Minister Arun Jaitley and is leading the Indian delegation for the annual Spring Meeting of the International Monetary Fund and the World Bank.

Transformational reforms such as Goods and Services Tax (GST) and initiatives such as Insolvency and Bankruptcy code, recapitalisation of banks, and unclogging of infrastructure investments will support such elevated growth, he stressed.

India has undertaken massive structural reforms toward formalisation of the economy and fostering digital financial inclusion.

India has accorded top priority to addressing its infrastructure deficit to sustain economic growth. Steps have been taken to mobilise funds from various sources for development of infrastructure that includes, launching of innovative financial vehicles, he added.

India has begun undertaking a major programme of monetising brown field assets of Central Public Sector Undertakings as a separate asset class for infrastructure investments, Garg said.

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