'7.8% growth but still import-dependent': Sridhar Vembu explains Modi’s Swadeshi push

Prime Minister Narendra Modi’s renewed appeal to Indians to avoid non-essential gold purchases, foreign travel and overseas weddings has sparked considerable debate on social media. Explaining the rationale behind the appeal, Zoho founder Sridhar Vembu said India needs to conserve foreign exchange as it remains dependent on imports for energy and advanced technology.

Vembu explained that despite India’s economy growing at 7.8%, the Prime Minister’s push for Swadeshi is driven by a few simple reasons:

East Asian nations (Japan, Taiwan, South Korea, and later China) all went through a phase of rapid GDP growth alongside the need to conserve foreign exchange. Here is why that happens.

• Our economy is growing at a good rate, but we still have an import dependence in both energy and technology. In fact, the faster the economy grows, the greater the need for both energy and technology inputs.
• To balance that import dependence, we have to export more, and our exports are surging. However, even our exports need advanced technological inputs (precision machines, materials, CPUs, GPUs, and advanced software) that we need to import today.
• Catching up in all of these areas takes time, often measured in decades. We have made a good start, but we need time.

“Look at how long it took East Asia to catch up with the West. Their economies were growing rapidly even as they worked hard to conserve foreign exchange. That is exactly what our government is trying to do.”

Once we gain competence in all the advanced technologies and achieve energy independence through the renewable energy we develop, we would no longer need to conserve foreign exchange. The situation is similar to that of a fast-growing company that needs capital to expand. So it has to conserve capital to invest in growth. Our nation needs to conserve foreign exchange, likewise, Vembu pointed out.

The mantra of Swadeshi, vocal for local: PM Modi

Prime Minister Narendra Modi on Tuesday hailed India's 7.8% real GDP growth in the first quarter of FY27, calling it a reflection of the “collective strength”.

In a video message posted on X, PM Modi congratulated the people of India for their hard work and said the country's economic growth came despite global challenges, including wars, crises and disrupted supply chains.

Rising above all this and cutting through these obstacles, the nation has achieved a growth rate of 7.8%. "We must maintain this momentum. We must keep moving forward, and for that, becoming Atmanirbhar Bharat is essential," the PM said.

Calling for greater emphasis on domestic products and local consumption, he said, “The mantra of Swadeshi, Vocal for Local: foreign trips, if you go for sightseeing, should not be done. If you do weddings abroad, you should not do them. One should live by the mantra of 'Wed in India'. And if it's not necessary, then gold should not be bought either.”

According to data released by the Ministry of Statistics and Programme Implementation (MoSPI), India's real GDP grew 7.8 per cent in Q1 FY27, covering the April-June period. Real GDP was estimated at ₹81.36 lakh crore in Q1 FY27, compared with ₹75.46 lakh crore in the same quarter of FY26. The latest growth figure was also higher than the 7 per cent Q1 FY27 growth estimate earlier projected by the Reserve Bank of India (RBI).

The RBI had also revised its real GDP growth forecast for the full financial year FY27 to 6.7 per cent from 6.6 per cent. Nominal GDP, measured at current prices, was estimated at ₹88.27 lakh crore in Q1 FY27, compared with ₹80 lakh crore in Q1 FY26, registering a growth of 10.3 per cent.