India will become the world’s third largest economy by 2027, the Finance Ministry says

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A pedestrian talks on a mobile phone as he watches a digital screen broadcasting the budget speech delivered by Indian Finance Minister Nirmala Sitharaman at the facade of the Bombay Stock Exchange (BSE) in Mumbai on February 1, 2021.

Puneet Paranjpe | AFP via Getty Images

India could become the world’s third largest economy by 2027 with a GDP of $5 trillion, the Finance Ministry said.

The forecast comes ahead of the interim budget scheduled to be released later this week.

In a report released on Monday, the Finance Ministry said the economy is poised to grow by 7% or more in fiscal 2024. India’s fiscal year begins on April 1 and ends on March 31.

If it achieves this year’s target, it will be the third consecutive year that GDP has grown by 7% in India.

The country’s GDP currently stands at $3.7 trillion.

India’s chief economic adviser, V Anantha Nageswaran, said the government’s goal is to become a developed country by 2047.

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“The strength we have seen in domestic demand, that is, private consumption and investment, has its origins in the reforms and measures implemented by the government over the past ten years,” Nageswaran said in the report, explaining the main drivers of growth in India.

He said investment in physical and digital infrastructure helped boost the supply side and manufacturing. As a result, he added, “real GDP growth is likely to be closer to 7 percent” in fiscal 2025.

The document released on Monday was not the India Economic Survey, which was prepared by the Ministry of Economic Affairs ahead of the Union Budget.

The Union Budget will be released only after the general elections between April and May this year – the interim budget will be presented by Finance Minister Nirmala Sitharaman on Thursday, and is unlikely to include any major changes in spending or taxation policies.

According to Goldman Sachs, India is expected to become the world’s second largest economy by 2075, overtaking not only Japan and Germany, but also the United States.

Currently, India is the fifth largest economy in the world, behind… The United States, China, Japan and Germany.

Optimism in the stock market

This article originally appeared on www.cnbc.com

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