In a recent address at the 13th Convocation of the ICFAI Foundation for Higher Education, former Reserve Bank of India Governor, C Rangarajan, praised India’s ascent to the fifth largest economy in the world as an “impressive achievement.” However, he underlined the importance of focusing on per capita income growth, stating that there is a need for rapid economic growth to elevate the country’s per capita income.
Rangarajan stressed the significance of formulating a clear roadmap for India’s future development, especially in the aftermath of the Covid-19 pandemic and the Russia-Ukraine war. He emphasized that boosting the growth rate should be the top priority.
Acknowledging India’s current status as the fifth largest economy, Rangarajan pointed out the disparity in per capita income. In 2020, India ranked 142nd out of 197 countries in terms of per capita income, highlighting the considerable distance the country must cover. He emphasized the necessity of accelerated growth given the current per capita income level.
Rangarajan suggested that if India can consistently achieve a seven percent growth rate over the next two decades, it could substantially elevate its economy and approach the status of a developed nation.
Additionally, he stressed the importance of absorbing new technologies and cultivating a skilled workforce to support this development. While acknowledging that new technologies may reduce employment elasticity concerning output, he highlighted the need for employment growth to be linked to increased economic expansion, making it a sustainable endeavor.
The former RBI Governor emphasized that India’s development strategy should be multidimensional, with a strong focus on bolstering the export and manufacturing sectors. He concluded that sustainable growth must prioritize equity to ensure a prosperous future.
The convocation featured M Jagadesh Kumar, Chairman of the University Grants Commission, as the chief guest.
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