Finance Minister Arun Jaitley Saturday said India is likely to retain its growth rate in the coming years, and that it will be one of the top three global economies in the world by 2031, with its GDP touching USD 10 trillion.
Addressing students at the Shri Ram College of Commerce’s Annual Day, Jaitley cited a study to say poverty will deplete over the years, and by 2024, the Indian middle class would be four times the size of the BPL (below poverty line) category.
“We keep oscillating between the fifth and the sixth largest (economy), depending on what the dollar rate at the time is… We are in all probability likely to retain that rate of growth. By 2024, we would probably be around USD 5 trillion, and by 2030 or 2031, about USD 10 trillion,” said Jaitley.
“That’s when we will be amongst the first three — US, China and India. Then of course, we will be in the rat race of the big three wanting to catch up with much mightier competitors. So the sheer size and opportunity is going to expand,” he said.
Jaitley, who is an alumnus of the college, said that as per the 2011 Census, 21.9% of India’s population was below the poverty line, but he “assumes” that it would have dropped to 17% today.
“Around 2021, it should be closer to about 15%. It’s not impossible for it by 2024-25 to be in a single digit, and then as we grow faster, it will deplete much faster,” he said, adding that by 2025, the middle class population would increase to 44% from 29% in 2015.
“Therefore, as you look ahead… you would see poverty deplete, you will see an exponential growth of this middle class and probably by 2030, almost half of India would be in that category (middle class). That’s a hugely aspirational category which also has purchasing power,” he said.
“Going by the data that I’ve been reading, in 2024, when the elections take place, the size of India’s middle class would be four times more than the size of the BPL (category). Therefore, we have to see whether public discourse is still behind the curve or it takes the curve further,” he said.
Addressing the students, Jaitley said there was a “great disconnect” in “a part of that discourse” and the way “many of you think”. He said that in India, there were “avenues of huge growth”.
“My suggestion to you would be — it’s a great opportunity, seize it. For your generation more than anyone else, there’s a huge space at the top, aim for that. Don’t look at the crowding at the bottom. That space is going to become much wider as India grows exponentially in the next two-three decades,” he said.