Navigating the Next Five Years

The Indian government's ambition to breach the $5-trillion mark by 2029 is well within grasp, and several measures will be responsible for reaching this state

- NIMESH SHAH

AS WE EMBARK on 2024, India stands at the precipice of an economic renaissance, poised to surpass economic giants Japan and Germany by 2025 and breach the monumental $5-trillion GDP milestone. The Indian government’s ambitious projections have set the stage for a comprehensive growth trajectory, with key sectors emerging as the linchpins of this economic ascent.

Setting the Stage for Growth A palpable air of optimism surrounds India’s economic landscape. Geopolitical shifts, a burgeoning youth demographic, and a strategic move away from China in global supply chains have converged with a slew of government incentives, creating a fertile ground for sectors such as manufacturing, infrastructure, housing, and logistics to thrive.

Per S&P Global, India’s nominal GDP is expected to soar to $7.3 trillion by 2030 from $3.5 trillion in 2022. This economic resurgence is underpinned by the largest adolescent and youth population globally.

Sectors Driving Growth Manufacturing: Constituting approximately 17% of India’s GDP, manufacturing emerges as a vital contributor to economic expansion. The ‘Make in India for the World’ initiative gains momentum, driven by strong domestic demand and growing interest in Indian exports. Various sub-segments exhibit promising trends, including increased capacity utilisation, a shift towards premiumisation in automobile sales, and significant strides in electric vehicles. Ancillary industries stand to benefit from evolving global strategies, while defence and aerospace manufacturing present lucrative opportunities.