India has become a beacon of hope for the world economy with its sound macroeconomic fundamentals. According to data released by PHD Chamber of Commerce, India is the only economy among the top 10 leading economies which has shown consistent improvement in its macroeconomic performance during the last 4 years, owing to its effective dynamic policy environment.
The government has taken the country's demographic dividend and consistent growth and fused it with favourable policy support to script a future that makes India the world’s bright spot. There are three key factors that will enable this.
Demographic dividend
India's demographic dividend is a key factor in the country's economic growth. With a large and expanding working-age population, it is poised to witness a surge in productivity and output. This demographic advantage, combined with pent-up growth provides an opportunity for India to accelerate its economic growth in the coming years.
Technology has also played a crucial role in India's economic growth story. Forward looking policy campaigns like ‘Digital India’ have helped digitalize majority of the economic activity and increase the digital footprint of Indians. The success of UPI and RuPay financial services has led to global adoption by major economies. The Digital India Bill, which is under works, will further empower Indian companies and entrepreneurs to rapidly scale up their tech solutions. This will help upgrade India’s ability to solve multi-dimensional challenges by enabling people to collaborate from different and remote domains.
With a strong emphasis on ‘women- led development’, the Indian government has aimed at empowering women, bringing the unbanked into formal banking, and promoting digital transactions. These measures have increased financial inclusion and helped push many of society's poorer groups into the formal sector, driving economic progress.
Progressive policy making
Furthermore, the government has implemented several policies and programs to address various outcomes related to gender equality and women's empowerment. These include initiatives to improve livelihood and employment opportunities, health and nutrition outcomes, education and skill building, prevention of violence against women and girls, and access to basic amenities like water, sanitation, housing, electricity, clean fuel, and childcare facilities.
The policies and programs are designed using a gender lens and allocated budgets are outcome-focused. The Indian government has also implemented a National Policy for Women Empowerment and schemes such as Beti Bachao Beti Padhao, Mahila E-Haat, UJJAWALA among others, to empower women.
India's government has continuously implemented a progressive regulatory framework that aligns with global policy standards. It’s strong macroeconomic fundamentals provide a solid foundation for the country's economic trajectory. According to the World Bank, India's economy is expected to grow by 6.3 percent in fiscal 2023. Moreover, the International Monetary Fund (IMF) has projected it to grow by 6 percent in 2023, one of the fastest pace of any major economy.
Encouraging investment
The government has proactively attuned policies to support growth in a very challenging economic environment globally. Economic policies in India have been geared to promote growth by encouraging investment, innovation, and entrepreneurship. The "Startup India" project has given young entrepreneurs a venue to promote their ideas and obtain finance, thereby encouraging innovation and employment development.
In conclusion, India's strong macroeconomic fundamentals, combined with progressive policies and initiatives, have cemented its position as a "bright spot" in the world economy. The country's demographic dividend, untapped growth potential, point to a positive future for India's economic prospects and provide reasons of optimism.
—The author, Alexander Reisch, is Managing Director, IPM India, a country affiliate of Philip Morris International, Inc. (PMI) in India. The views expressed are personal.
(Edited by : C H Unnikrishnan)
First Published: May 25, 2023 11:22 AM IST
