Lok Sabha Question No. 221 (UNSTARRED), answered on 2023-12-04
Subject: Five Trillion Economy
Ministry: FINANCE
Asked by: Raghu Ramakrishna Raju Kanumuru, Manne Srinivas Reddy, Komati Reddy Venkat Reddy

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

## LOK SABHA

## UNSTARRED QUESTION NO. 221

TO BE ANSWERED ON DECEMBER 4, 2023

## FIVE TRILLION ECONOMY

221. SHRI KANUMURU RAGHU RAMA KRISHNA RAJU: SHRI MANNE SRINIVAS REDDY: SHRI KOMATI REDDY VENKAT REDDY:

Will the Minister of FINANCE

Be pleased to state:

- (a) whether the Government has set aim of five trillion economy;
- (b) if so, whether the exchange rate is an overlooked factor in achieving the said goal;
- (c) if  so,  the  comparative  details  thereof  showing  the  targets  set/achieved  since  1947  till now in this regard, if not, the reasons therefor;
- (d) the  mechanism  developed  till  now  in  this  regard  and  the  output  of  various  sectors contributing to reach the goals till now; and
- (e) the help extended to such sectors/results yielded till now since 1947?

## ANSWER

## MINISTER OF STATE FOR FINANCE (SHRI PANKAJ CHAUDHARY)

(a)-(b): The government has set the goal of becoming an advanced economy by 2047. In the process, it will become a USD 5 trillion economy early in the Amrit Kaal. This milestone will be crossed with the help of a strong rupee which will result from macroeconomic stability. The exchange rate is not an overlooked factor as it ranks India's GDP size in the world. The IMF projects India to become a USD 5 trillion economy with the third largest GDP in 202728.

(c) :  India  is  a  market  economy,  and  the  government  monitors  economic  progress  through market-determined GDP and exchange rate. Past data is shown in Table 1 in the Annexure.

- (d): Both  domestic  and  international  markets  are  the  mechanisms  that  determine  India's GDP, exchange rate and contribution of various sectors to GDP.  Table 2 in the Annexure shows the contribution of the broad sectors to the economy in 2022-23.
- (e): The  Government  also  contributes  to  economic  progress  through  policy  interventions, including  the  measures  announced  in  the  annual  budgets.  Major  initiatives  taken  by  the government in the last  9  years  for  directly  increasing  the  GDP  include,  among  others,  the implementation  of  the  Insolvency  and  Bankruptcy  (IBC)  Code,  recapitalisation  of  Public Sector Banks, rollout of Goods and Services Tax (GST), reduction in Corporate Tax, boost in Effective Capital Expenditure, introduction of Production Linked Incentive (PLI) Scheme in 14 sectors, continuous liberalisation of the FDI regime, and building of Digital Infrastructure.

## Annexure

Table 1: GDP in USD and average exchange rate

| Year    |   GDP (in USD Billion) |   Exchange Rate (₹/US$) |
|---------|------------------------|-------------------------|
| 1980-81 |                  189.4 |                     8.1 |
| 1990-91 |                  326.6 |                    12.8 |
| 2000-01 |                  476.6 |                    35.5 |
| 2010-11 |                 1708.5 |                    45.6 |
| 2020-21 |                 2671.6 |                    63.6 |
| 2022-23 |                 3732.2 |                    77.5 |

Source: NSO, MoSPI and RBI

Table 2: Contribution of Agriculture, Industry and Services

to nominal GDP in 2022-23 (in per cent)

|   Agriculture |   Industry |   Services |
|---------------|------------|------------|
|          18.4 |       28.3 |       53.3 |

Source: NSO, MoSPI

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