International Monetary Fund (IMF) in its update of flagship World Economic Outlook was released in Davos.  It said that India’s GDP is forecast to expand 7.5% in FY20 and 7.7% in FY21.

However, Niti Aayog, the government’s think tank, has pitched for an average 8% growth over the next five years to lift India to a $4-trillion economy in its 75th year of independence, proposing a strategy for a New India by 2022.

 The need for consistent 8% growth rate is needed for

• To alleviate poverty: India’s 21.9% of citizens live below poverty line despite 70 years of Independence.
• Doubling the farmer’s income by 2022: A goal set for warding off the agrarian distress and ensure remunerative incomes to farmers.
• Increase the employment generation: This will help leverage the demographic potential and reap demographic dividend.
• To empower the weaker sections of society: The SC’s, ST’s, women who still remain backward due to poor empowerment.
• To invest in social and economic infrastructure: Education, health, infrastructure & logistics still need a lot of improvement.

India needs to undertake more substantive economic reforms if it wants to push its economic growth rate to its long-held target range of 8 to 10 percent a year.

Agriculture Sector:

• Implementing Ashok Dalwai committee recommendations
• Focus on policy to create favourable investment climate in agriculture.
• Placing agricultural marketing in the Concurrent list.
• Greater private sector participation in agri-marketing and logistics.
• Market reforms and investment in infrastructure for cold-chain integration to reduce wastages.
• Forming FPOs/VPOs as collectives to give unified voice to small and marginal farmers.
• The committee strongly recommends stepping up of institutional credit on a large scale.
• Increase focus on export to raise agricultural export by a minimum of three times by 2022-2
• Implementing the Model Land Leasing Act and encouraging Contract Farming to make the most out of available lands.
• A strong push would be given to ‘Zero Budget Natural Farming’ techniques that reduce costs, improve land quality and increase farmers’ incomes.
• A shift in agriculture to convert farmers into ‘agripreneurs’ by expanding e-National Agriculture Markets.
• Replacing the Agricultural Produce Marketing Committee Act with Agricultural Produce & Livestock Marketing Act.

Manufacturing Sector:

• The Indian MSME sector provides maximum opportunities for both self-employment and wage employment outside the agricultural sector.
• Five key aspects of facilitating the MSME sector: Access to credit; Access to market; Technology upgradation; Ease of doing business; social security for employees.
• Loans offered to small businesses in the unorganized sector are now covered by a credit guarantee scheme. Ease of credit availability within 59 minutes
• eCommerce platform reforms like Barring e-commerce marketplaces from selling products of firms in which they own stakes. ban deep discounts for selective products which earlier disturbed the level playing field.
• Setting up an export promotion cell within the MSME.
• TreDs platform to facilitate finance of trade receivables.
• Schemes like SFURTI, ASPIRE have been introduced to strengthen the Khadi and Agro MSMEs.
• ‘Make in India’ scheme: improve competitiveness, increase investments and increasing skills of workers in accordance to changing needs of market.
• Adopting global quality standards to products to enter markets of developed economies.
• Better labour codes to ensure ease of hiring and firing of employees.
• Development of SEZ’s , NIMZ to boost manufacturing sector.

Services Sector:

• The Indian service sector is the fastest growing service sector in the world. It contributes more than 60% to India’s economy and accounts for 28% of employment.
• The opportunities in this fast-growing, employment-oriented, FDI attracting sector, with vast export-potential are striking.
• There is an urgent need to increase access to higher education and vocational training at affordable prices. Implementation of Sharda Prasad committee
• Focus on other sub-sectors like education, health than financial and business services which have grown at a faster rate than the services sector overall.
• Increasing Labour productivity by skill training and continuous upgradation.
• The large working age population of India should focus on developing as a knowledge-based economy.
• Focusing on other aspects of Ease of Doing business like reducing the litigation time, ease of setting up industries.
• Increasing the PPP ventures in Infrastructure projects by Government being responsible for land acquisition while private players are taking care of rest.
• Easing the FDI norms in sectors like Accounting, Retail, legal services etc. which have huge potential of investments and job generation.
• Focusing on R&D in the latest technologies like BigData, AI, Machine Learning and training people for the impending Industrial Revolution 4.0.

Conclusion:

Thus, an overall growth in all the three sectors with collaboration from the governments, private players and citizens can help India achieve the 8% growth target in a sustained manner.