Play the long game
The World Bank predicts that India’s economy will grow 6.9% in 2022-23, up from the 6.5% estimated earlier
At a time when a bleak economic environment is dimming prospects around the world, an upgrade in the gross domestic product (GDP) forecast for India stands out. In its latest India Development Update released on Tuesday, the World Bank predicts that India’s economy will grow 6.9% in 2022-23, up from the 6.5% estimated earlier. Its brighter view is underpinned by the belief that India’s economy will be less affected than other emerging economies by turmoil as the West tips closer to a recession. For this, we can thank domestic demand, seen to have rebounded well from its pandemic depths. Although exports have sagged, our relatively decoupled economy is not very vulnerable to stagnant growth overseas. With China in a covid slump, this means India will remain one of the fastest-expanding major economies for a while. Yet, this must not yield complacency. We need output to grow at 8% or more for decades on end, and this cannot be achieved without efficiency-oriented structural reforms and a big export thrust to go with increasing integration with the world in terms of capital flows, supply networks, etc. Being a bright spot is good, but we must sustain it to play the long game.