The road to a $5 trillion economy by 2025 is beset with many speed breakers, the NITI Aayog has warned the government.
To begin with, the think tank has said the nominal GDP growth — a measure of growth without accounting for inflation — has to be at least 12.4% on an average if that target has to be reached. The current rate was a mere 8% in the first quarter of the current financial year.
The government is expected to release data for the second quarter (July to September) later this month. Experts estimate that growth will dip in Q2 compared to Q1 in both real and nominal terms. For example, while GDP growth in real terms in Q1 stood at 5%, state-run lender State Bank of India recently estimated that this could dip to 4.2% in Q2, with a corresponding dip in nominal growth as well. Real GDP growth accounts for inflation in its calculation.
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The road to a $5 trillion economy by 2025 is beset with many speed breakers, the NITI Aayog has warned the government. To begin with, the think tank has said the nominal GDP growth — a measure of growth without accounting for inflation — has to be at least 12.4% on an average if that target has to be reached. The current rate was a mere 8% in the first quarter of the current financial year. The government is expected to release data for the second quarter (July to September) later this month. Experts estimate that growth will dip in Q2 compared to Q1 in both real and nominal terms. For example, while GDP growth in real terms in Q1 stood at 5%, state-run lender State Bank of India recently estimated that this could dip to 4.2% in Q2, with a corresponding dip in nominal growth as well. Real GDP growth accounts for inflation in its calculation.