India expected to become 'Fastest Growing' major economy from FY22: PHD Chamber

India is expected to become the 'Fastest Growing' major economy from FY22, PHD Chamber of Commerce and Industry said on Saturday.

According to Sanjay Aggarwal, President, PHD Chamber of Commerce and Industry, the country's economy is "going to attain its fastest growth trajectory from the next financial year 2021-22 onwards".

In a recent growth estimate by the International Monetary Fund (IMF), India is projected to become the fastest growing economy among the top 10 major economies in the world economic system from 2021 to 2025.

"The average GDP growth of Indian economy in next five years from 2021 to 2025 will be at 7.8 per cent, highest as compared with top 10 economies including 6.2 per cent of China, 3 per cent of France, 2.9 per cent of United Kingdom, 2.9 per cent of Canada, 2.4 of United States, 2.3 per cent of Germany, 2.3 per cent of Italy, 2.3 per cent of Brazil and 1.4 per cent of Japan," Aggarwal was quoted as saying in a statement.

"The size of the economy will increase from Rs 203 trillion in FY 2019-20 to Rs 331 trillion in FY 2025-26 at current prices, which becomes at around US$ 4.42 trillion considering the exchange rate at 74.9 (average of current fiscal year 2020-21; April-October)."

Besides, the industry body pointed out that percolation of more and more economic reforms at the ground level with effective implementation would be crucial to attain the potential trajectory of $5 trillion in the next 6 financial years by FY 2026-27 (GDP at current prices; considering the exchange rate between 74-75).

"On the back of various reforms undertaken by the government, economic recovery has become visible in the high frequency economic and business indicators of the recent months," he said.

Recently, PHD Chamber on the basis of PHDCCI Economic and Business Momentum (EBM) Index, estimated that the GDP growth will be at around (-) 7.9 per cent for the current financial year 2020-21 as compared with the median forecasts of (-) 9.3 per cent by various national and international forecasting organisations.

"At this juncture, demand creation measures are needed to attain a positive growth trajectory sooner rather than later," he said.

"Demand creation along with increased spending on infrastructure will have multiplier effects on the economic growth trajectory by boosting private investments, creating new employment opportunities in the country, generating demand for commodities such as steel, cement and power.".