As Prime Minister Narendra Modi aims for a third term, global investors are focusing on India’s growth, yet inequality has worsened.
Narendra Modi seems likely to secure a third term as India’s prime minister, backed by substantial financial support. His party has amassed more political funds than all others combined, receiving backing from the nation’s wealthiest business figures.
The campaign is energized by Modi’s narrative of India’s economic progress, attributed in part to reforms enacted during his tenure. Additionally, India’s growing appeal to global investors due to geopolitical shifts has bolstered Modi’s position. Understanding India’s economy requires considering five crucial factors. Elections are scheduled to run from April 19 to June 4.
India is big and getting bigger
India, with the world’s largest population, has historically grappled with poverty on a per-person basis for centuries. However, over the past three decades, its economy has gained significant momentum and currently stands at a value of $3.7 trillion. Such a substantial size offers inherent benefits: even a mere one percentage point of growth holds monumental significance.
India is fastest growing in major Economy
In recent years, India has earned the title of the “fastest-growing major economy.” In 2022, it surged past Britain to become the fifth-largest economy globally. Even if its growth maintains a relatively moderate pace, projections indicate that India is poised to surpass both Germany and Japan by around 2030, securing its position as the third-largest economy, trailing only behind China and the United States.
The “India growth story,” as dubbed by local business figures, is sparking enthusiasm among investors, particularly from abroad. Under the leadership of Mr. Modi, Indians are increasingly optimistic about their nation’s economic prospects. As the economy expands, even minor growth rates accumulate substantial wealth.
However, several facets of the Indian economy persist unchanged. A significant portion of the workforce remains engaged in agriculture, while only a small fraction is employed in industrial sectors. Without improved job opportunities, many Indians will continue to be excluded from experiencing this prosperity.