Reclaiming the Lost Glory

Abstract

Until 1820, India accounted for one-sixth or more of world output. But under British rule and in the wake of the Industrial Revolution, its economy was eclipsed. Today, though, India stands on the cusp of reclaiming its lost glory. During the fifteen years ending in 2017/18, India’s economy grew 7.7 percent in real rupees and 9.9 percent in real dollars. Today its GDP stands at $2.6 trillion. Even if it were to grow at only 8 percent in real dollars in the coming decade, GDP would reach $7.2 trillion by 2030/31, placing the country in third place in the global GDP rankings. But, as the experiences of all successful developing countries show, sustained growth at a rate of 8 percent or higher requires a policy framework that leads to greater outward orientation, urbanization, and expansion of labor-intensive manufacturing. With concerted policy reform, such transformation is within India’s grasp.