Lok Sabha Question No. 911 (UNSTARRED), answered on 2022-02-07
Subject: Indian Economy
Ministry: FINANCE
Asked by: T. R. Paarivendhar

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF ECONOMIC AFFAIRS

## LOK SABHA UNSTARRED QUESTION NO. 911

TO BE ANSWERED ON FEBRUARY 7, 2022

## INDIAN ECONOMY

## 911. DR. T.R.PAARIVENDHAR:

Will the Minister of FINANCE be pleased to state:

- (a) whether it is true that India is likely to be ranked Asia's second largest economy by the year 2020 when its GDP is also projected to surpass that of Germany and UK as per the recent report of IHS Markit which is a US based global leader in information and analytics of major industries and markets worldwide report;
- (b) if so the details thereof;
- (c) whether it is also true that India is currently the sixth largest economy in the world; and
- (d) if so, the steps taken or to be taken by the Government to achieve the IHS Markit's expectations?

## ANSWER

## MINISTER OF STATE IN THE MINISTRY OF FINANCE (SHRI PANKAJ CHAUDHARY)

- (a)  &  (b):  As  per the  IHS Markit report published on 7 th January 2022, 'India's nominal GDP measured in USD terms is forecast to rise from USD 2.7 trillion in 2021 to USD 8.4 trillion by 2030.  This  rapid  pace  of  economic  expansion  would  result  in  the  size  of  the  Indian  GDP exceeding  Japanese GDP by 2030, making India the second largest  economy in  the AsiaPacific  region.  By  2030,  the  Indian  economy  would  also  be  larger  in  size  than  the  largest Western European economies, notably Germany, France and the United Kingdom'.
- (c):  As per the IMF's World Economic Outlook Database (October 2021), India is 6 th largest economy in the world, in terms of GDP at current prices (in USD).
- (d): Government has implemented several major reforms in recent years to boost investment and GDP growth. These include  Insolvency  and  Bankruptcy  Code  (IBC);  recapitalization  of banks; roll out of Goods and Services Tax (GST); Make-in-India programme; liberalization of Foreign  Direct  Investment  (FDI);  cut  in  the  corporate  tax  rate;  and  making  of  National Infrastructure pipeline of projects worth more than Rs.100 lakh crore.  Enhancing of support under Direct Benefit Transfers (DBT) mission protected the poor.

In  FY  2020-21,  as  a  major  part  of  its  policy  response  to  the  pandemic,  Government,  while providing a safety net to the vulnerable sections of the society, implemented several structural reforms  to    strengthen  private  sector  investment.   These  include change  in  definition  of MSMEs, new PSU policy, commercialization of coal mining, higher FDI limits in defence and space  sector,  development  of  Land  Bank  and  Industrial Information  System,  revamp  of Viability Gap Funding scheme for social infrastructure, new power tariff policy and incentivizing States to undertake sector reforms among others. Emergency Credit Line Guarantee Scheme

(ECLGS) was launched to provide collateral free guaranteed loans for business enterprises in various sectors affected by COVID-19.

Following the announcements in the Union Budget 2021-22 further, capital expenditure of the government was significantly enhanced along with more than doubling of health budget. To enhance India's manufacturing capabilities and exports, an outlay of  about Rs. 2 lakh crore was  announced  for  Production  Linked  Incentive  (PLI)  schemes  covering  14  key  sectors  of manufacturing. Government also announced a relief package of Rs 6.29 lakh crore in June 2021 to strengthen public health and provide impetus for growth and employment measures.

Continuing  with  the  growth  supportive  measures,  Union  Budget  2022-23  has  announced  a 35.4 per cent increase in outlay of capital expenditure, PM GatiShakti National Master Plan for seamless multimodal connectivity  and  logistics  efficiency,  expansion  of  guarantee  cover  for MSME,  infusion  of  funds  in  Credit  Guarantee  Trust  for  Micro  and  Small  Enterprises (CGTMSE) scheme, programme for Raising and Accelerating MSME Performance (RAMP), human  capital  formation  through  universalization  of  quality  education  and  establishment  of Digital University, Ease  of Doing Business 2.0 reforms, Urban Development, Export Promotion,  Clean  &  Sustainable  Mobility,  Extension  of  Emergency  Credit  Line  Guarantee Scheme (ECLGS) by Rs 50,000 crore to total cover of Rs 5 lakh crore, among others.

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