Global leaders are increasingly recognizing India’s potential to become a major superpower, with projections indicating it could soon be the world’s third-largest economy. The nation is on a transformative path, driven by the government’s Production-Linked Incentive (PLI) schemes, a surge in local manufacturing, and impressive GDP growth.
Over the past decade, India has embarked on a robust growth journey under the leadership of Prime Minister Narendra Modi. Initiatives have spanned various sectors, including local manufacturing, semiconductor development, artificial intelligence, 5G technology, startups, and innovation. This period has also seen significant investments in workforce skill development, resulting in the creation of millions of jobs.
The PLI schemes are set to significantly boost the manufacturing sector, projecting a threefold increase to $1.66 trillion from the current $459 billion. This growth surpasses the $175 billion average increase seen over the last decade. A recent report by DSP Mutual Fund forecasts that the manufacturing sector’s contribution to GDP will rise from 14 percent in FY24 to 21 percent by FY34, supported by reduced logistics costs and enhanced infrastructure. Additionally, infrastructure investments are expected to increase from 33 percent to 36 percent of GDP by FY2029.
The electronics manufacturing sector alone has generated over 1.2 million jobs and is anticipated to grow from $100 billion to $250 billion in the next five years. Investments in PLI schemes for 14 sectors are projected to reach between $36 billion and $48 billion in the coming years.
As India strives to become the third-largest global economy, the concerted efforts of all states and the central government are essential to achieving this goal and realizing the vision of Viksit Bharat by 2047. President Droupadi Murmu highlights that recent reforms and the nation’s rapid rise from the 11th to the fifth-largest economy underscore the momentum towards this ambitious target. India’s impressive growth, averaging 8 percent annually from 2021 to 2024, contributes 15 percent to global growth, reflecting the country’s significant economic impact.
Prime Minister Narendra Modi recently praised the robust job market, with 125 million jobs created between FY14 and FY23, noting that India’s position as the third-largest economy by 2030 is within reach. The Prime Minister emphasized that 69 percent of Indians feel the economy is moving in the right direction, a sentiment reinforced by the country’s substantial domestic consumption and influence in global forums such as BRICS and the G7.
UK Foreign Secretary David Lammy’s recent comments reflect the growing global recognition of India’s economic potential. He highlighted shared interests in areas such as green technology and economic security and noted that Free Trade Agreement (FTA) negotiations are just the beginning of expanding the bilateral relationship between the UK and India.
As India aims to solidify its position as a global superpower, the collaborative efforts of all states and the central government are crucial. The Economic Survey 2023-2024 projects a GDP growth rate of 6.5 to 7 percent for 2024-25, underscoring a strong economic outlook. PM Modi emphasized the importance of creating a vision for 2047 at all levels of governance to realize the goal of Viksit Bharat.
India’s rising status as a top destination for foreign direct investment (FDI) is evident, with a 69 percent increase in FDI in the manufacturing sector over the past decade. The total FDI inflow has surged to $383.5 billion in the last five financial years, driven largely by the PLI schemes. According to a recent HSBC survey, manufacturing activity in India continues to grow robustly, fueled by strong domestic demand and new export orders.
