Modi government has set a target of propelling India’s economy to $3 trillion by the end of 2019-2020. It also aims at becoming $5 trillion economy by 2024-2025. In order to achieve this target India’s economy requires 8-9% growth every year for next few years. However, India’s economy clocked 6.8% in the year ending 2018-19, one of the lowest in past five years. “Irrespective of which government tells you what, the economy is in bad shape”, the chairman of Bajaj Auto Rahul Bajaj quoted after analysing the performance of Bajaj Auto in first quarter.
Almost 11 million Indians lost their jobs during 2018, a report by the Centre for Monitoring Indian Economy (CMIE) said. The number of employed recorded in December 2018 was at 397 million, which is 10.9 million less than the figure of 407.9 million seen a year ago at the end of December 2017. The auto sector which contributes 7% to India’s GDP is facing one of its worst downturns. Decreasing sales of cars and motorcycles is expected to trigger massive job cuts in India’s auto sector. The Periodic Labour Force Survey (PLFS) of the National Sample Survey Office (NSSO) released in the month of May showed the unemployment rate in the country in FY18 was at 5.3% in rural India and 7.8% in urban India, resulting in overall unemployment rate of 6.1%.
India is proud of the fact that it is one of the fastest growing economies in the world. As per the United Nations report India lifted 271 million people out of poverty between 2006 and 2016, recording the fastest reductions in the multidimensional poverty index values during the period. However, India which is considered as one of the emerging economies, has very low per capita income. The country's per-capita income have risen by 10% to Rs 10,534 a month during the financial year ended March 2019 as per government’s national income data. This rise is however much less compared other emerging economies like China, Brazil and Russia.
After nearly 6 years in power, Prime Minister Narendra Modi in an interview to Economic Times said that he will make India a better place to do business. In order to reassure India Inc, Modi said that the government wanted entrepreneurs to enjoy higher productivity and better profits. Prime Minister appealed to the country's bankers to pass on the benefits of low interest rates to borrowers and assured them that they would not be harassed by the authorities. PM Modi also said that his government was committed to fulfilling its five-year vision of investment-led growth, targeting Rs 100 trillion. With respect to slowdown in auto sector, Modi said that the slowdown impacting the automobile sector was temporary and that the transition to electric vehicles was not a cause for worry.
Mukesh Ambani, CEO of Reliance Industries endorsed Prime Minister Narendra Modi's goal of making India a 5 trillion-dollar economy by 2024. Addressing the 42nd Annual General Meeting of Reliance Industries, Mukesh Ambani referred the economic slowdown to be temporary. L&T Power CEO, Shailendra Roy, in his interview with Economic Times said, “India is aiming to be a $5 trillion economy in the next five years, for which industrial growth needs to accelerate. If we don’t add power generation capacity now, that plan will be unachievable.”
Indian Economy which is considered to be the fastest growing economy in the world is going through a tough time. The government needs to look beyond the political gain and work towards improving the economy of the country. At the time when leading economies of world such as Europe, US, South Korea, Japan are ageing, India has an advantage of having more younger population. As of 2018, the median population of India was 29 years which is much younger than China’s 38 years. Therefore, government needs to work generating more employments and providing more opportunities to youthful India.