<p>New Delhi: The Indian economy is likely to transition to an upper-middle income country, with per capita income of $4466, between the financial years 2033 and 2036, India Ratings and Research (Ind-Ra) said Monday.</p>.<p>Until 2006, the World Bank classified India as a low-income country. In 2007, India moved to the lower-middle income country and since then has remained there. India’s per capita GDP stood at $2,390 in 2022. A country with per capita income in the range of $4,466 to $13,845 is categorised as upper-middle income economy.</p>.<p>According to the rating agency, the size of the Indian economy is likely to reach $15 trillion by 2047, which is around half of the government’s projections. Finance Minister Nirmala Sitharaman recently said that achieving a $30 trillion economy by 2047 is a “conservative” estimate.</p>.India gets $100 billion FDI commitment under trade pact from EFTA countries.<p>In order to achieve the $30 trillion target, Ind-Ra said the Indian economy will have to grow at 9.7 per cent per annum between now till 2047 in the current dollar terms.</p>.<p>In the past 50 years, there have been only two instances when the economy grew higher than 9.7 per cent per annum in current dollar terms for a period of 10 years: 1973-1982 and 2003-2012. “Cross country experience of 50 years suggests that it is difficult to maintain and sustain such a high rate of real GDP growth in USD terms as the economy starts maturing,” said Sunil Kumar Sinha, senior director and principal economist at Ind-Ra.</p>.<p>“We expect the Indian economy under different scenarios to enter into the upper-middle income category over FY33–FY36 and to a $15 trillion economy over FY43-FY47,” Sinha added.</p>.<p>Rating agency CRISIL had also recently predicted that India would become an upper middle income economy by 2031 with the size of the economy crossing $7 trillion.</p>.<p>On the future growth projections, Sinha noted: “the Indian economy is showing robust growth, but cross-country experience also shows that no major economy has been able to grow 7 per cent (real) per annum on a sustained basis without the support of global demand/trade.”</p>.<p>“The target of reaching $30 trillion by 2047 would be not easy and a lot would depend on how the global and domestic macroeconomic environment unfolds from here on,” the rating agency noted.</p>.<p>However, irrespective of whether India attains the $30 trillion target by 2047 or not, Ind-Ra estimates of per capita income reaching $9,218 to $9,920 over FY43-FY47 means India would be much closer to the high-income country’s threshold of $13,846 per capita.</p>
<p>New Delhi: The Indian economy is likely to transition to an upper-middle income country, with per capita income of $4466, between the financial years 2033 and 2036, India Ratings and Research (Ind-Ra) said Monday.</p>.<p>Until 2006, the World Bank classified India as a low-income country. In 2007, India moved to the lower-middle income country and since then has remained there. India’s per capita GDP stood at $2,390 in 2022. A country with per capita income in the range of $4,466 to $13,845 is categorised as upper-middle income economy.</p>.<p>According to the rating agency, the size of the Indian economy is likely to reach $15 trillion by 2047, which is around half of the government’s projections. Finance Minister Nirmala Sitharaman recently said that achieving a $30 trillion economy by 2047 is a “conservative” estimate.</p>.India gets $100 billion FDI commitment under trade pact from EFTA countries.<p>In order to achieve the $30 trillion target, Ind-Ra said the Indian economy will have to grow at 9.7 per cent per annum between now till 2047 in the current dollar terms.</p>.<p>In the past 50 years, there have been only two instances when the economy grew higher than 9.7 per cent per annum in current dollar terms for a period of 10 years: 1973-1982 and 2003-2012. “Cross country experience of 50 years suggests that it is difficult to maintain and sustain such a high rate of real GDP growth in USD terms as the economy starts maturing,” said Sunil Kumar Sinha, senior director and principal economist at Ind-Ra.</p>.<p>“We expect the Indian economy under different scenarios to enter into the upper-middle income category over FY33–FY36 and to a $15 trillion economy over FY43-FY47,” Sinha added.</p>.<p>Rating agency CRISIL had also recently predicted that India would become an upper middle income economy by 2031 with the size of the economy crossing $7 trillion.</p>.<p>On the future growth projections, Sinha noted: “the Indian economy is showing robust growth, but cross-country experience also shows that no major economy has been able to grow 7 per cent (real) per annum on a sustained basis without the support of global demand/trade.”</p>.<p>“The target of reaching $30 trillion by 2047 would be not easy and a lot would depend on how the global and domestic macroeconomic environment unfolds from here on,” the rating agency noted.</p>.<p>However, irrespective of whether India attains the $30 trillion target by 2047 or not, Ind-Ra estimates of per capita income reaching $9,218 to $9,920 over FY43-FY47 means India would be much closer to the high-income country’s threshold of $13,846 per capita.</p>