Hyderabad, India needs to grow at 9 per cent for five consecutive years to become a US$ 5 trillion economy by 2025, said Dr C Rangarajan, renowned economist and the Chancellor of the ICFAI, it was reported.
The Government needs to strive to achieve this growth by bringing in reforms, said Dr Rangarajan, who presided over the eleventh Convocation of the ICFAI Foundation for Higher Education.
Commenting on the state of the economy, he said that the economic crisis that the country is facing is different as it has been triggered by a non-economic factor.
Economies around the world suffered due to lockdown and ensuing loss of production, he said the country’s GDP fell by 7.3 percent in 2021 and the contraction of economy impacted daily wage earners, and migrant laborers the most.
After contracting 24.4 percent in the first quarter of 2020-21, the economy witnessed a real growth of 20.1 percent in the first quarter of 2021-22, but compared to 2019-20 GDP fell by Rs 3.3 Lakh Crores, said the former RBI Governor.
He was positive about the country achieving annual growth of 9.5 percent as forecast by RBI and IMF, but opined that the real test for the economy will be 2022-23, where faster growth rate is needed to make up for the loss of output. The foundation for faster growth needs to be laid this year.
With the pandemic the hope that India would be a US$ 5 trillion economy by 2025 became elusive. The economy which was US$ 2.7 trillion in 2019, would be around the same by 2022, he added.