Udayavni Special

India risks income stagnation if GDP doesn’t grow at 8% annually: Report


PTI, Aug 26, 2020, 4:21 PM IST

New Delhi: India’s GDP needs to rise annually at 8-8.5 per cent to create opportunities in the post-Covid-19 era, and the country risks a decade of stagnating incomes and quality of life if urgent steps are not taken to spur growth, says a report.

According to the report by McKinsey Global Institute (MGI), the country will have to undertake a slew of reform measures over the next 12-18 months with the aim of increasing productivity and creating jobs.

Given the increasing urbanisation and population trends, there will be 90 million additional workers in search of non-farm jobs by 2030 and India will have to triple job creation to 12 million gainful non-farm jobs per year from the 4 million achieved between 2013 to 2018, it said.

The GDP, which is set to contract by over 5 per cent as per some estimates in FY21, needs to go up to 8-8.5 per cent per annum for the next decade to create the opportunities, it said, warning of difficulties if it is not achieved.

“Absent urgent steps to spur growth, India risks a decade of stagnating incomes and quality of life,” MGI warned.

On the reforms front, it advocated attention to manufacturing, real estate, agriculture, healthcare, and retail sectors, unlocking land which can reduce prices by up to a fourth, creating “flexible” labour markets, enabling efficient power distribution to reduce tariffs for consumers by over 20 per cent and privatizing 30 top state-run enterprises.

From a financial sector perspective, it said reforms and streamlining fiscal resources can deliver USD 2.4 trillion in investment while boosting entrepreneurship by lowering the cost of capital for enterprises by about 3.5 percentage points and also pushed for creation of a ‘bad bank’ to take care of the dud assets.

A bulk 60 per cent of the reforms will have to be undertaken by states and the remaining 40 per cent by the Centre, it added.

The think tank pointed out that the manufacturing and the construction sectors offer the most opportunities for economic growth and also for higher employment.

The report has identified 43 ‘frontier businesses’ across sectors, claiming they have the potential to create USD 2.5 trillion in economic value and 30 per cent of non-farm jobs by 2030, but added that India needs to triple its number of large firms having revenues of over USD 500 million.

Udayavani is now on Telegram. Click here to join our channel and stay updated with the latest news.

Top News

Why lie on SC order on national task force, Fadnavis asks Sena

U’khand has highest COVID fatality rate among Himalayan states: NGO

Practically impossible to provide oxygen to other states due to rising COVID cases: Kerala CM tells Centre

Nalin Kumar Kateel donates Rs. 2.50Cr to Dakshina Kannada for Covid-19 relief

‘Karnataka plans to open triaging centres in Dakshina Kannada, 9 other dists’

Kolkata Durga idol makers anxious about business in second Covid-hit year

Users not accepting new privacy terms to face limited functionality: WhatsApp



Related Articles More

Sebi comes out with new proposal for segregation, monitoring of collateral at client level

Snapdeal launches Sanjeevani app to connect COVID patients with potential plasma donors

Ola to start doorstep delivery of oxygen concentrators to consumers

Cipla inks pact with Eli Lilly to produce, sell COVID-19 treatment drug

Grant IGST exemptions to donors getting COVID relief material from abroad: Sisodia to FM Sitharaman

MUST WATCH

Kuwait ship carrying medical oxygen arrives at Navamangalore port

Dr Dinesh Shetty | Current Situation in Karnataka | Udayavani

Young man comes to buy vegetables wearing doctor’s apron

Unique Safety Method to save from Police

Udayavani 10 -May -2021 News Bulletin

Latest Additions

Why lie on SC order on national task force, Fadnavis asks Sena

Armed forces helping admin in fight against COVID-19: Centre to HC

U’khand has highest COVID fatality rate among Himalayan states: NGO

Twitter handle of J-K Lt Governor suspended briefly, officials cite technical error

Practically impossible to provide oxygen to other states due to rising COVID cases: Kerala CM tells Centre

Thanks for visiting Udayavani

You seem to have an Ad Blocker on.
To continue reading, please turn it off or whitelist Udayavani.