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Why is India Poised to be the Next Big Economy?
Posted on January 23, 2024 by Editor
As we step foot into the future of India’s economic landscape, the next decade presents a picture of growth and transformation. Fueled by a combination of demographic advantages, sector-specific expansions, and labour code reforms, India stands on the cusp of becoming a global economic powerhouse.
The United Nations World Economic Situation and Prospects 2024 report projects a 6.2% GDP growth for India in 2024, attributed to robust domestic demand and burgeoning growth in the manufacturing and services sector. Echoing this optimism, the Economic Survey 2022-23 anticipates a baseline GDP growth of 6.5% in real terms for FY24. These forecasts paint a picture of an economy that is not only recovering post-pandemic but also moving towards sustained long-term growth.
Labour Code Reforms
The consolidation of 44 central labour laws into four comprehensive codes marks a change in India’s labour landscape. These reforms, encompassing the Wage Code, Social Security Code, Occupational Safety, Health and Working Conditions Code, and Industrial Relations Code, aim to simplify compliance, ensure equity, and leverage technology for effective enforcement. By applying to all employees regardless of their role or salary (with minimal exceptions), these codes are set to create a more inclusive and efficient work environment, conducive to economic growth and workforce welfare.
Demographic Dividend
Our demographic profile provides a substantial advantage. Housing a fifth of the world’s youth population and with a median age of just 28.4 years, India’s youthful energy is its asset. The declining total fertility rate (TFR) and the expected surpassing of China’s population in 2023 further underscore the potential of this dynamism in propelling economic growth.
The healthcare sector in India is on the brink of substantial growth, influenced by several critical factors. An ageing population is a key driver, with about 21% of the elderly in India reportedly having at least one chronic disease according to the National Institute of Health Report. The report also highlights that this trend is more pronounced in urban areas, where 29% of the elderly suffer from chronic conditions, compared to 17% in rural regions. Hypertension and diabetes are the most common, accounting for about 68% of these chronic diseases. Alongside this, increasing disposable incomes are enabling more individuals to seek advanced healthcare services.
The impact of the COVID-19 pandemic cannot be understated; it has highlighted the need for robust healthcare infrastructure and services. This realisation has catalysed investments in the sector, not just to meet the growing domestic health demands but also to elevate India’s stature in the global healthcare industry. As a result, India is steadily positioning itself as a player in international healthcare, capable of meeting health needs with its capabilities.
Renewable Energy and IT Sector: Leading the Sustainable and Digital Charge
The renewable energy sector is set to witness substantial growth, aligning with the global shift towards sustainability. As the world pivots to green energy, India’s advancements in this sector could be instrumental in shaping global energy trends. Simultaneously, the IT sector continues to be the backbone of the economy, with potential for further expansion, reinforcing India’s status as a global IT hub.
Diverse Sectoral Growth from Manufacturing to Tourism
Other sectors like BFSI, automotive, retail, and travel & tourism are also expected to see increased hiring and growth, indicative of a broader economic upswing. Banks, healthcare, and energy sectors are also well-positioned for growth in 2024, aligning with global economic shifts and internal market demands.
India’s economic landscape for the next decade is marked by growth across diverse sectors, backed by demographic dividends and strategic reforms. As the nation gears up for this phase, policymakers, businesses, and the workforce must align their strategies with these trends. The amalgamation of economic reforms, sector-specific growth, and a vibrant, young workforce sets the stage for India to not just grow but also to play a role in shaping the global economic narrative in the years to come.
Why is India Poised to be the Next Big Economy?
Posted on January 23, 2024 by Editor
As we step foot into the future of India’s economic landscape, the next decade presents a picture of growth and transformation. Fueled by a combination of demographic advantages, sector-specific expansions, and labour code reforms, India stands on the cusp of becoming a global economic powerhouse.
The United Nations World Economic Situation and Prospects 2024 report projects a 6.2% GDP growth for India in 2024, attributed to robust domestic demand and burgeoning growth in the manufacturing and services sector. Echoing this optimism, the Economic Survey 2022-23 anticipates a baseline GDP growth of 6.5% in real terms for FY24. These forecasts paint a picture of an economy that is not only recovering post-pandemic but also moving towards sustained long-term growth.
Labour Code Reforms
The consolidation of 44 central labour laws into four comprehensive codes marks a change in India’s labour landscape. These reforms, encompassing the Wage Code, Social Security Code, Occupational Safety, Health and Working Conditions Code, and Industrial Relations Code, aim to simplify compliance, ensure equity, and leverage technology for effective enforcement. By applying to all employees regardless of their role or salary (with minimal exceptions), these codes are set to create a more inclusive and efficient work environment, conducive to economic growth and workforce welfare.
Demographic Dividend
Our demographic profile provides a substantial advantage. Housing a fifth of the world’s youth population and with a median age of just 28.4 years, India’s youthful energy is its asset. The declining total fertility rate (TFR) and the expected surpassing of China’s population in 2023 further underscore the potential of this dynamism in propelling economic growth.
The healthcare sector in India is on the brink of substantial growth, influenced by several critical factors. An ageing population is a key driver, with about 21% of the elderly in India reportedly having at least one chronic disease according to the National Institute of Health Report. The report also highlights that this trend is more pronounced in urban areas, where 29% of the elderly suffer from chronic conditions, compared to 17% in rural regions. Hypertension and diabetes are the most common, accounting for about 68% of these chronic diseases. Alongside this, increasing disposable incomes are enabling more individuals to seek advanced healthcare services.
The impact of the COVID-19 pandemic cannot be understated; it has highlighted the need for robust healthcare infrastructure and services. This realisation has catalysed investments in the sector, not just to meet the growing domestic health demands but also to elevate India’s stature in the global healthcare industry. As a result, India is steadily positioning itself as a player in international healthcare, capable of meeting health needs with its capabilities.
Renewable Energy and IT Sector: Leading the Sustainable and Digital Charge
The renewable energy sector is set to witness substantial growth, aligning with the global shift towards sustainability. As the world pivots to green energy, India’s advancements in this sector could be instrumental in shaping global energy trends. Simultaneously, the IT sector continues to be the backbone of the economy, with potential for further expansion, reinforcing India’s status as a global IT hub.
Diverse Sectoral Growth from Manufacturing to Tourism
Other sectors like BFSI, automotive, retail, and travel & tourism are also expected to see increased hiring and growth, indicative of a broader economic upswing. Banks, healthcare, and energy sectors are also well-positioned for growth in 2024, aligning with global economic shifts and internal market demands.
India’s economic landscape for the next decade is marked by growth across diverse sectors, backed by demographic dividends and strategic reforms. As the nation gears up for this phase, policymakers, businesses, and the workforce must align their strategies with these trends. The amalgamation of economic reforms, sector-specific growth, and a vibrant, young workforce sets the stage for India to not just grow but also to play a role in shaping the global economic narrative in the years to come.