India may achieve the $5 trillion economy status by FY29, which is contrary to the Modi-led government's aims of achieving the coveted status by 2024-25. India's nominal GDP (gross domestic product) will rise to $4.92 trillion by FY28, the data in IMF's World Economic Outlook Database, released in April, suggests. This means the country will touch the $5 trillion economy mark in the financial year FY29. The global monetary body has not released its estimates for India beyond FY28.
In February, the Centre had also extended this target by a year. The government is now aiming to become a $5 trillion economy by FY26 or the next year by achieving 8-9% sustained GDP growth. "If we continue to retain the path of 8-9 per cent real GDP, it would translate into 8 per cent dollar GDP growth. If we extrapolate that we should be at the USD 5 trillion by 2025-26 or 2026-27," chief economic adviser V Anantha Nageswaran had said during the finance minister's post Budget 2022 interaction on February 1.
In rupee terms, the nominal GDP could grow at 13.4% in FY23, says the IMF data, while in dollar terms, it's estimated to grow at 8.2%. In FY23, the rupee is seen depreciating to $81.5 per dollar vs 77.7 per dollar in FY22. On the back of a continuous depreciation in value, the rupee's value could depreciate to 94.4 per dollar by FY28, the IMF estimates show.
India is one of the fastest-growing economies and is currently ranked as the world’s 6th largest economy. The government aims to achieve $1 trillion from agriculture and allied activities, $1 trillion from manufacturing and $3 trillion from services.
In April, the International Monetary Fund (IMF) lowered India's growth forecast by 8 percentage points to 8.2% in FY23 against 9% projected in January 2022. Russia’s invasion of Ukraine and the global sanctions against the country are largely to blame, the IMF said, adding that high inflation due to fuel and food price rises would also play a key role in dragging the economic growth back.
For FY24, too, India’s GDP growth forecast has been lowered to 6.9%, 2 percentage points down compared to 7.1% projected earlier. Before that, the World Bank also did a downward revision in India's GDP for FY23 to 8% from 8.7% projected earlier. Both of these estimates are higher than the Reserve Bank of India’s GDP estimates, which in its Monetary Policy Report for April 2022, projected India's real GDP growth at 7.2% in 2022- 23.
Besides, the IMF has said global growth is projected to slow from an estimated 6.1% in 2021 to 3.6% in 2022 and 2023. This is 0.8 and 0.2 percentage points lower for 2022 and 2023, respectively than in the January World Economic Outlook Update.