India's economy can scale new highs. Here's a plan

India can become the world's third-largest economy within the next few years. To achieve true prosperity for all, India must keep its GDP growth high, generate mass employment, overhaul education, focus on environmental sustainability, and safeguard its social fabric

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At an event in the Capital this week, Prime Minister (PM) Narendra Modi promised that India will become the world's third largest economy if he gets a third term (2024-2029). Chanakya believes that this goal is eminently achievable. The International Monetary Fund's World Economic Outlook database shows that India will overtake both Japan and Germany, currently the third and fourth largest economies respectively, in 2026-27 to become the third largest economy in the world, behind only the United States and China.

But two larger questions linger. Is the PM's statement just a political reiteration of the inevitable? And, should becoming the third largest economy make us complacent on the economic front? The short answer to both these questions is an unqualified no. But it is worth engaging with them in detail.

When India became independent 75 years ago, it was ravaged by the scars of Partition, with a very small industrial base of its own. When rains played truant, even food security became a challenge, and the nation had to resort to what is infamously remembered as the ship-to-mouth existence, a reference to the excessive dependence on overseas grain exports.

The journey from economic precarity to becoming a global economic power while keeping its democratic core intact-the two years of Emergency notwithstanding - is a unique achievement, and the result of the collective endeavours of the Indian people. Of course, there have been ups and downs, and course corrections in this economic march. The biggest milestone in this path came in 1991, when the government formally launched a raft of economic reforms that unleashed animal spirits in the economy. The growth surge we see today would not have been possible without that leap of faith.