Uday Kotak calls for fiscal discipline, reforms to make India a developed nation by 2047
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Veteran banker Uday Kotak on Friday called for greater fiscal discipline, reforms to attract more capital and improved manufacturing capabilities to help India navigate a fragile global environment and achieve the goal of ‘Viksit Bharat’ by 2047.
Drawing parallels between the East India Company's historical expansion and the growing influence of global technology companies and major economic powers, he cautioned that changing global dynamics pose challenges to national sovereignty and economic independence.
Speaking at a conference of finance ministers and finance secretaries of states and Union Territories organised by the Union Finance Ministry here, Kotak said close coordination between the Centre and states will help India withstand the challenges facing the world at large.
India's position on the global stage is pretty good, but there is no room for complacency, he said.
He said India must focus on seven key areas, including fiscal consolidation, strengthening the financial system, leveraging global crises for reforms, boosting domestic production, addressing gold imports, balancing regulation with development, and encouraging creative destruction in businesses.
On fiscal policy, Kotak said India needs to move towards tighter fiscal management, noting that the consolidated fiscal deficit remains above 7 per cent compared to the US at 6 per cent.
"Excessive financialisation early in the life of a developing country towards development is something India needs to be careful about," he said.
Kotak also highlighted the need to reduce India's dependence on imports and create products and services that the world wants to buy.
"We as Indians need to create leverage where we produce things, goods, and services which the world wants from us," he said, citing the potential for India to become a major exporter of products such as flowers.
On gold imports, he said India needs to find a way to channel household gold wealth into productive use while addressing the country's current account challenges.
Kotak further called for a balance between financial regulation and development, saying regulators should ensure financial stability without unnecessarily restricting growth.
He urged traditional businesses to embrace innovation and change, including in areas such as artificial intelligence, and said creative destruction was necessary to transform the Indian economy