India's Economy Poised to Double in Size Over the Next Decade
India's Economic Growth Forecast
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New Delhi, Oct 8: According to a recent report, India's economy is projected to expand significantly, potentially exceeding trillion within the next ten years, driven by structural reforms, increased infrastructure investment, and formalisation efforts that enhance growth and attract global investments.
The analysis from KKR indicates that India has already surpassed the trillion mark and is on a trajectory to double its economic size again in the coming decade.
“India exemplifies how long-term structural reforms can yield substantial benefits over a decade rather than just a few quarters,” the report stated.
It highlighted that reforms initiated since 2014, such as the Goods and Services Tax (GST), the Insolvency and Bankruptcy Code, labour market formalisation, and digital advancements, combined with ongoing infrastructure investments, have significantly boosted India's growth potential.
These reforms are anticipated to support a nominal GDP growth rate of up to 11 percent.
Furthermore, the report suggests that there is still potential for the existing reforms to generate additional economic benefits.
“We believe this narrative is far from complete,” KKR remarked.
Additionally, the report points out that the formalisation of the economy has mitigated the risk premium associated with Indian cash flows, thereby enhancing the prospects for sustained growth.
Regarding technology, the report asserts that artificial intelligence (AI) is not expected to negatively impact the domestic technology services sector.
On the contrary, domestic IT firms may increasingly leverage AI in their service offerings, positioning it as a new growth avenue for the sector.
Moreover, Global Capability Centres (GCCs) are emerging as a vital growth driver, complementing traditional IT services, with services already contributing over half of India's real GDP growth.