India Could Become a USD 20 Tn Economy by 2036: Equirus
India needs 14.2 per cent underlying rupee growth and sustained annual currency appreciation of 3–3.6 per cent to hit the target.
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India could become a USD 20 trillion economy by 2036 if it raises underlying rupee growth to around 14.2 per cent and sustains annual rupee appreciation of 3–3.6 per cent, according to a report by Equirus Securities.
In its report titled ‘India’s Road to a USD 20 Trillion Economy’, the brokerage has laid out a 20-point reform agenda to support the target.
India took 67 years after independence to build its first USD 2 trillion in GDP, then nearly doubled the economy in the decade after 2014. From the current base of about USD 3.7 trillion, reaching USD 20 trillion would require the economy to expand roughly 5.5 times, implying sustained nominal dollar growth of around 18 per cent a year, against India’s historical trend of 10–11 per cent.
“From a starting point near USD 3.7tn, reaching USD 20tn means growing the economy about 5.5 times, which works out to a sustained nominal growth rate of roughly 18 per cent in dollar terms comfortably above India’s historical trend of 10-11 per cent,” the brokerage said.
Services are expected to be the primary growth engine. The sector currently accounts for about 54 per cent of GDP and would need to rise past 65 per cent, expanding from roughly USD 2 trillion to over USD 11 trillion. Manufacturing (17–20 per cent of GDP) is seen as capped by a more protectionist global environment, while agriculture’s share (about 17 per cent) is expected to shrink further as urbanisation increases.
The reform agenda spans five areas: the real economy, capital markets, human capital, the services engine, and liveability and governance.
Key proposals include bringing fuel under GST, mandatory state capital-expenditure floors, listing the Railways, setting up an India Sovereign Fund on the Temasek model, reviving private R&D, bond-equity tax parity to deepen capital markets, tapering small-savings schemes, abolishing advance tax, cutting TDS to a flat 5 per cent, ending the double transaction tax, and a national policy for Global Capability Centres.
India could become a USD 20 trillion economy by 2036 if it raises underlying rupee growth to around 14.2 per cent and sustains annual rupee appreciation of 3–3.6 per cent, according to a report by Equirus Securities.
In its report titled ‘India’s Road to a USD 20 Trillion Economy’, the brokerage has laid out a 20-point reform agenda to support the target.
India took 67 years after independence to build its first USD 2 trillion in GDP, then nearly doubled the economy in the decade after 2014. From the current base of about USD 3.7 trillion, reaching USD 20 trillion would require the economy to expand roughly 5.5 times, implying sustained nominal dollar growth of around 18 per cent a year, against India’s historical trend of 10–11 per cent.
