India On the Road to Become $4 trillion Economy

By Consultants Review Team Monday, 20 November 2023

India's GDP is still some way from hitting $4 trillion, but economists believe the milestone is not far away. According to the Union Budget 2023-24, India's nominal GDP is expected to reach Rs 301.75 lakh crore, a 10.5% increase from Rs 272.41 lakh crore in the fiscal year 2022-23. In US dollars, this equates to $3.63 trillion in GDP for the current fiscal year.

"A $4 trillion economy does not appear likely in the current environment." It would imply a nominal GDP of almost Rs 330 lakh crore, which could be achieved with 10% growth in 2024-25, according to Madan Sabnavis, chief economist of Bank of Baroda.

On Sunday, screenshots of a picture indicating that India's GDP had increased to $4 trillion went viral on social media, prompting many to rejoice, noting that India's overtaking of the United Kingdom as the world's third-largest economy was not far away.

This was not officially confirmed or denied. The National Statistical Office, which is part of the Ministry of Statistics and Programme Implementation, publishes India's official GDP figures regularly. All entities, including international organizations, rely on official estimates.

The first advance estimates of GDP for fiscal year 2023-24, which will include nominal GDP growth expectations, will be published in early January, ahead of the Interim Budget 2024-25. The second advance estimates would be released in February, followed by the first provisional projections in May. Economists and professionals, on the other hand, questioned the data being posted on social media, pointing out that real-time predictions are frequently inaccurate.

"I'm astonished at how quickly everyone jumps on a screenshot. On a rolling basis, India will not reach $4 trillion until late 2024 or early 2025. This fiscal year (2023-24), India's nominal GDP is estimated to be around Rs 300 [lakh crore], implying a GDP of roughly $ 3.65 trillion at current exchange rates," said Rahul Bajoria, MD & Head of EM Asia (ex-China) Economics, Barclays, on his personal X account (previously known as Twitter).

"India's GDP isn't yet $4 trillion, unfortunately," remarked Deepak Shenoy, Founder and CEO of Capitalmind, on X. We were about $3.38 trillion in June, and we could be around $3.45 trillion now at best." Official GDP figures for the fiscal second quarter will be issued after the month.


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