Viksit Bharat Calls For New Reforms And Innovative Perspectives

Agriculture and allied activities, which have been showing lesser growth than their potential, need greater investment and modernization apart from enhanced use of technology and research to develop newer variety of food products so as to double agricultural income in five years

The years leading to Viksit Bharat by 2047 is being presumed as the country’s golden period as it is India's Amrit Kaal. It is a period of reckoning as the country has to progress towards achieving the developed nation status. It is felt that while China is likely to register a meagre growth level, India has the potential to take the growth drivers to a higher trajectory on a continuous and sustainable basis.

It is hence quite understandable that the confidence levels of registering a stable and sustained higher growth is high among all stakeholders.

This implies that we must put in place futuristic-driven economic, reformist and favourable policies and tap the less pursued growth drivers to realise the 2047 goal.

More importantly every stakeholder must swear by India's aspirational Viksit Bharat vision and contribute their economic and political wisdom in order to ensure higher productivity year after year.

There has been some feeling that unless this vision is followed by higher investment, greater innovation and technological advantage (the combination of Investment+Innovation+Technology) can take us to the high income nation status. It is therefore imperative to prove that with appropriate steps and action combined with economic empowerment, productivity gains, putting back profits and additional capital to new capacity creation, new vistas of technological growth drivers and women participation at the higher level in economic engagement and youth power we can on the right growth path. Equally crucial will be MSMEs emerging as global players and making agriculture a dynamic economic force.

By all accounts, the figure of $30 trillion dollar economy by 2047 is a reality when manufacturing is gradually becoming a global hub, service and other global exports reach $ two trillion, ‘Digital India’ becoming global drivers of digital transformation.

RBI Governor Shaktikanta Das, in his recent inaugural address to FIBAC, said "To realise the aspiration of transitioning from emerging to advanced economy by 2047, India would need a multi-pronged and multi-sectoral approach. Our focus should be employing all engines of growth both from supply and demand sides"

Agriculture and allied activities, which have been showing lesser growth than their potential, need greater investment and modernization apart from enhanced use of technology and research to develop newer variety of food products so as to double agricultural income in five years. We are yet to take the potential of agriculture and allied activities to full extent and the coming years as focussed in this year's budget must get greater attention both from private sector and public sector.

The long cherished dream of swelling manufacturing sector's share to GDP to 25 per cent and create India as a global sourcing of manufactured products along with China plus approach with recent initiatives like PLI scheme, ‘one district one product’, a vibrant industrial corridor, welcoming higher FDI investment in manufacturing, higher contribution to Research and Development, expanding the base and reach of export products with new products and new technology developed for global adoption should be focus for the achieving the goals.

MSMEs should get special focus as in the current budget eight new measures have been proposed. A BCG report points out that MSMEs have the potential to contribute 50 per cent of GDP by 2030, employ 150 million people and account for 60 per cent of exports.

Financial institutions and SIDBI must bring higher MSMEs to formal credit and credit expansion so as to make the sector a very profitable segment, opines BCG. The government and private sector can contribute capital along with debt to MSMEs as scale and technology adoption and research and development have higher scope. In this regard, the recent measure of considering guarantee coverage of up to Rs. 100 crore for term loan is a welcome step.

Adoption of AI, Gen AI, ML and cloud computing in financial institutions and government and private sector governance and administration, leveraging partnership and collaborative efforts and higher investment to drive digital acceleration will be additional growth drivers. The efforts of the government in creating best of physical and social infrastructure should get the support of the private sector by way of greater participation.

While development is the key, we have to be mindful of higher balance for environmental concerns and reducing green gas emissions and going for massive capacity in alternative energy capacity. The private sector investment needs to be widened.

The efforts to have greater household savings, higher investment, higher consumption, enhanced exports of goods and services all have to move in tandem as stated by RBI governor. The logistics cost has to get reduced substantially, which is possible by connecting with global supply chains.

There is a need to bring in reforms that can accelerate economic gains while preserving and enhancing the benefits of the earlier reforms. Opening the economy to the global market with less or competitive tariffs and providing equal opportunities to domestic and external entrepreneurs and the current global political uncertainty should cement India’s position as a reliable and quality global supplier.

The RBI Governor has also called for "holistic approach to nurture and accelerate a broad based growth of the economy would also necessitate preservation of the gains of past reforms and accelerating India's reform journey to newer vistas." On that count, the task of the Union and State government is cut out as we strive for Viksit Bharath by 2047.

Meanwhile, private sector cannot rest on past laurels but instead get immersed and grab the potential by way of a greater involvement. The private sector must also be strong in all respects when global players enter India.

(The author is former Chairman & Managing Director of Indian Overseas Bank)