The GDP of India grew by 5.4% in the September quarter, the slowest in around two years. (File)
India looks poised to surpass the position of the third-largest economy by 2030, Arvind Panagariya, the chairman of the 16th Finance Commission of India, has said, adding the country's GDP is expected to reach around $6.5 to 9 trillion.
Speaking at The Times Network India Economic Conclave 2024 on Thursday, the former vice-chairperson of NITI Aayog said the implementation of some of the pending reforms could further accelerate growth rates.
The Indian economy, even after witnessing financial crisis, non-performing assets crisis and the COVID-19 pandemic, grew at about 10%, Arvind Panagariya said.
"Even if you want to assume that we will grow only 8% in current dollars, that gets us over $7 trillion. So, the prospects look incredibly good," he said, adding that even if we stay at $7 trillion, it will be a couple of trillion dollars more than the next country.
A major reason behind this, according to Mr Panagariya, is because the fundamentals of the Indian economy are "absolutely solid."
"We have weathered the COVID-19 crisis... recovered from it, actually with flying colours. I expect us to return to at least about 7% economic growth," he noted.
Mr Panagariya's statement comes months after rating agency S&P Global, in September, said India was on course to emerge as the third-largest economy in the world by 2030-31, with its expected annual growth rate at 6.7% in 2024-25.
The GDP of India grew by 5.4% in the September quarter, the slowest in around two years.
On India's post-pandemic recovery, Mr Panagariya sees more of an overall improvement rather than a K-shaped recovery -- wherein various parts of the economy recover at different rates.
He also dismissed the claims that the rising inequality was making the rich richer and the poor poorer.
"Yes, billionaires have come in, and if you look at the distribution, if you look at the inequality in the sense of the top 1% as a proportion of the bottom 5%, yes, that inequality has gone up," he said, highlighting the "bottom 5% today, in absolute terms, are doing a lot better".
Mr Panagariya believes that except for a handful of sectors, India should remain open to investments from China as the other developed countries like the US and Germany.
"If the US is taking investment from China, if Germany is taking, I would (be) open to their investment. The activities from which you want to exclude are relatively few because I don't see other countries restricting Chinese investment in a large number of sectors," he said.
He cautioned against investments from potentially "unfriendly" nations that might damage the interest of the nation.