Editorial February 2023 India Shining will it Outperform the World Economy

Rajiv Parikh

15 Feb 2023

India has been at the center stage of the global economic forum. India is expected to become $7T economy in seven years, says Chief Economic Advisor, Anantha Nageswaran and it will reach $3.5T by the end of 2022-23 fiscal. The government had previously said India would become a $5T economy by 2025.

“Nominal GDP or GDP at Current Prices in the year 2022-23 is estimated at ₹273.08 lakh crore, as against the Provisional Estimate of GDP for the year 2021-22 of ₹236.65 lakh crore, released on 31st May, 2022. The growth in nominal GDP during 2022-23 is estimated at 15.4 per cent as compared to 19.5 per cent in 2021-22,” National Statistics Office (NSOs) statement added.

Based on the recent events and geopolitical tensions including the Ukraine-Russia war, the world economy has suffered and US has been playing its own game in order to dominate the world with its $ reserves. However, countries have started trading in non-usd currency. How long the USD will remain the world reserve currency is a big question specially when EVs will be replaced with oil and OPEC countries will look forward to revenue from other sources than oil. Also, how will the US debt issue be resolved once $ will not be used as a global currency. It is just a matter of time before countries will be self-sustaining for energy and will start to use renewal sources of energy. The US is targeting 2050 to be net zero. India has a realistic dream of achieving net zero emission by 2070. The recent India Energy Week was very successful and speaking at the opening ceremony, Prime Minister Modi said: “The energy sector plays a major role in deciding the future of the world in the 21st century. India is one of the strongest voices today in developing new resources of energy and in the energy transition. The country which is also all set to become a developed nation, has unprecedented possibilities for the energy sector.” Also, recently India discovered 5.9 Million Tons of Lithium metal in J&K which is one of the main ingredients in battery manufacturing used in EVs. This discovery has added a ray of hope to achieve automobile emission neutrality earlier than expected.

India’s budget had been largely appreciated by most people and organizations and the amount of money India is investing in infrastructure is staggering. The whole landscape has been changed in recent times which will make cargo and personal travel using trains and road infrastructure to an amazing new level.

This includes the Ahmedabad – Mumbai bullet train which will reduce the travel time from approx. 12 hours to 8 hours. Remember, this will hugely benefit the chemicals and the pharmaceuticals industry as about 70%-80% of the chemical industry is concentrated within Gujarat. Along with the train infrastructure, the state of Gujarat has the Dahej Port which is a multi-cargo port located in the Gulf of Khambhat and is strategically situated on international maritime routes and provides easy access to the dense industrial hubs of Gujarat, Maharashtra and Madhya Pradesh.

The highway roads infrastructure from Delhi to Mumbai and several highways throughout India are in the works including tourist destinations like Goa. The Indian road network is looking to match the world class standard with wide scale expansions and makeovers. The central government’s “Braratmala” project has helped in building a solid network of roads, highways and expressways. India also plans to build at least 26 green expressways by 2025. One Bank of America report says that the total length of national highways in the country is expected to reach 112000 miles. The report further states that the total road infrastructure build between 1950 and 2015 combined will be built during the decade ending in 2025. No wonder the use of construction chemicals and raw materials used in the cement industry is at an all-time high and probably will be higher with more expansion on the roads infrastructure.

"The government is dedicatedly working towards the development of a national highway network of 2 lakh km length by 2025. It's a big thing", said Road Minister Mr. Nitin Gadkari.

Recently India was also a part of the World Economic Forum Annual meeting in Davos in Switzerland. Center for Economics and Business Research (CEBR) predicts that by 2035, India will become the third $10 T economy. Also, as the manufacturing has been moving out of China to India specially in chip manufacturing and digital goods manufacturing like TVs and mobile phones and other electronics, the Indian exports will be increasing to an unprecedented level with time.

In summary, with whatever happens on a global scale, India hasbeen resilient in its growth plans irrespective of the covid19 situation, the war, or the Adani issue which I believe was a target to the Indian economy. The right will be a winner and will flourish. Are you prepared for insane growth in the next 2-5 years?

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