Modi, CMs to draw up ‘developed India’ plan

With eye to achieving developed country status by 2047, the 100th anniversary of Independence, the Central government will seek suggestions from states to stitch together a 25-year blueprint for growth with focus on seven-to-eight specific areas that are vital to economy and human development.

One area of focus will be to strengthen small businesses, a major job creator and the backbone of manufacturing and exports, the person quoted above said. Agro and food processing sectors will get special attention.

Another area is to identify the capital expenditure needed to achieve economic growth targets over the medium term.

Scaling up per capita income, cutting red tape, improving the ease of doing business and increasing women work participation from the current 26% to more than 40% are among targets to be discussed.

The identified focus areas have already been shared with state leaders.

“Growth is dependent on how much capital is invested. If the annual growth rate to be achieved is 10% on a ₹301 trillion economy, the investment requirement may roughly be four times of that growth to be achieved," said the person, explaining that for every ₹100 of incremental output, ₹400 of investment is needed.

“Women work participation in the country is only 26% in the country, compared to more than 50% for men. We cannot become a developed economy without women’s participation in work crossing 40%. How we can economically empower women is also a key focus area," the person said. Skill development to make people employable will also be discussed with states.

NITI Aayog said in a tweet on Tuesday that its governing council meeting will be held under the chairmanship of Prime Minister Modi on Saturday at Pragati Maidan. “It will provide the opportunity to deliberate on the vision of VikasitBharat @ 2047," the federal policy think tank said.

Experts said that that scaling up per capita income to that of a high income economy in 25 years is doable. “In our most optimistic simulation, a real GDP growth of 6-6.5% growth over a longish period of time will take India to developed country status which is defined as US$13,000 per capita income. That would be achieved by 2045," said D.K. Srivastava, chief policy advisor, EY India.

At present, India’s per capita income is over $2300, going by ₹272 trillion nominal GDP in FY23, a population of 1.4 billion people and an exchange rate of ₹82.83 to the dollar.

At Saturday’s meeting, state chief ministers are expected to highlight their development priorities, financial requirements and challenges too. Given that the federal body comprises the central and state political leadership, discussions could also gain a political tone.

The eighth meeting of the NITI Aayog governing council comes at a time the economy which is predicted to grow at 6.5% this fiscal is facing multiple challenges from high interest cost, inflation, risks to monsoon from El Nino and the possible spillover effects of the banking stress and economic uncertainty in developed markets.