Hyderabad : Renowned economist and India’s former Reserve Bank Governor, Raghuram Rajan, delivered a stark warning during a recent event organized by Manthan at Ghulam Ahmed Auditorium in Hyderabad. Rajan emphasized the necessity for India to expedite its economic growth beyond the existing 6% annual rate if it aims to avoid lingering in the lower-middle-income category by 2047, marking the conclusion of the Amrit Kaal period.
Rajan pointed out that sustaining a 6% growth rate, without corresponding population growth, would lead to a doubling of per capita income every 12 years. However, even with this growth, India, currently with a per capita income of around $2,500, is projected to retain its lower middle-income status by 2047. The economist highlighted a troubling trend in certain southern states where population growth is falling below the reproduction rate, resulting in an overall economic slowdown and an aging population.
Expressing apprehension, Rajan stated that the existing growth trajectory is inadequate to absorb the rising workforce and achieve prosperity before India’s population ages. He stressed the urgency of faster economic growth to counter the dual challenge of an aging population and limited economic resources.
In summary, Raghuram Rajan’s insights underscore the critical significance of accelerating India’s economic growth beyond the 6% annual threshold. This proactive approach is essential to break free from the lower middle-income trap and effectively address the challenges posed by demographic shifts. By implementing measures to stimulate growth and ensuring inclusive development, India can carve out a prosperous future for its citizens and unlock its full potential.
