Will need to target 9% GDP growth; foreign investments, R&D spendhold the key
India can build a $10-trillion economy over two decades if it targets 9 per cent annual GDP growth, said a report by global professional services firm PricewaterhouseCoopers (PwC). This report, entitled ‘Future of India – The Winning Leap’, was launched by Dennis M Nally, Global Chairman of PwC, in the Capital on Monday. It outlines the solutions required to lead India to unprecedented economic growth coupled with radical improvements in its human development index (HDI) over the next two decades.
Releasing the report, Nally, on his fourth trip to India this year, said he has tremendous confidence about India and its future.
“We believe in the growth story of India and want to be part of it from PwC’s standpoint. India’s aspiration of achieving 9 per cent is certainly attainable,” he said.
For PwC, which has been here for over 130 years, India is one of the most important markets and the best is really yet to come, he said.
To achieve the aspirational 9 per cent GDP growth, there is a need to increase annual foreign investment flows six-fold, Nally said.
There is also a need to ramp up research and development (R&D) spends as a percentage of GDP from 0.8 per cent in 2013 to 2.4 per cent in 2034. Both the Government and industry should collaboratively take steps to increase R&D spend, Nally said.
A combination of higher R&D investment, technological spillover and better allocation of financial capital will accelerate GDP growth, he said.
Reform push
For India to achieve 9 per cent growth to become a $10 trillion economy, substantial and enduring reforms should be undertaken across all sectors, said Deepak Kapoor, PwC India Chairman.
A concerted effort from corporate India, supported by a vibrant entrepreneurial ecosystem and a constructive partnership with the Government, will play a critical role, he said.
For the report, PwC spoke to 80 business leaders across sectors in India and abroad and surveyed 1,500 employees (less than 35 years of age) within its network.
Shashank Tripathi, Partner and Strategy Leader at PwC India, said the report stressed that linear growth in each sector would not be enough to meet the growth ambition envisioned for India.
Given the complexity and scale of the challenges facing the country, the resources required, and the urgency of demands for change coming from Indian citizens, sector players must work out solutions that deploy non-linear growth, it said.
For instance, an approach that increases ‘average years of schooling’ from seven to 10 by 2034 could save the education sector $170 billion in cumulative investments, Tripathi said.
This can only happen when innovative solutions such as mEducation receive wide-scale adoption, investment and execution, he said. Business Line
