FM Nirmala Sitharaman sees India's per-capita income almost doubling

Nirmala Sitharaman speaks at the Kautilya Economic Conclave

Finance minister Nirmala Sitharaman said income per person will almost double in five years time as the economy continues to grow, while warning that the global environment is tougher now than it was in the past.

“The upcoming decades will see the steepest rise in living standards for the common man, truly making it a period-defining era for an Indian to live in,” Sitharaman said at the Kautilya Economic Conclave in New Delhi on Friday.

Citing figures from the International Monetary Fund, the minister said per-capita income was $2,730 (Rs 2.29 lakh), and that “it will take only five years to add another $2,000 (Rs 1.68 lakh).”

India’s steady economic expansion, controlled inflation and higher spending on infrastructure will boost growth, but global challenges could disrupt the momentum, Sitharaman said.

“The global backdrop is no longer the same,” she said. “This poses a potential challenge and an opportunity for India.”

Prime Minister Narendra Modi has pledged to make India a developed country by 2047 — the centenary of the country’s independence — a goal that would require 8%-plus growth rates for the next quarter century, economists estimate. Rising incomes would help to reduce the wide inequality gap in the nation.

• A global geopolitical re-positioning is advantageous for India and the country needs to create “robust supply chains” with other nations
• “India benefits from the new international order, which is reshaping better to reflect the power distribution of today’s world,” she said
• The government remains committed to reducing its fiscal deficit and focusing on improving the quality of its expenditure. The deficit will decline from 5.6% of gross domestic product in the financial year 2023-24 to 4.9% in year through March
• “A larger proportion of fiscal deficit is now accounted for by capital outlays, indicating an increasingly investment-oriented deficit financing,” she said