The Finance Minister of India, Nirmala Sitharaman had presented the Union Budget for this fiscal and laid out an ambitious project of making India a $5 trillion economy by 2025. The announcement ignited a mild outburst of debates and discussions until another shocking aspect of the Indian economy came into light. The Central Statics Office (CSO) revealed that the real GDP (Gross Domestic Products) growth in Q1 of current fiscal fell to a 6-year low of 5 percent causing a great threat and worrisome condition for country's economic health.
This overwhelming fact has raised the question – A $5 trillion! Is it even possible? Well, the current condition says that it isn't.
As for now the India economy worth $2.8 trillion and to reach the landmark of $5 trillion economy by 2025, it will need to grow by CAGR of 12 percent over the next half-decade. With the prevailing condition, the gap between the current market scenario and the desired growth rate seems extremely wide to bridge.
Initially, to turn this into reality, improvements in productivity lead is need to be made. A digital backbone is crucial to enable such productivity either by reaching the right beneficiary, optimizing the paperless process through automation or digitized payments. Currently, Digital India has become more data-rich than ever and has the potential to accelerate productivity specifically in innovative areas such as AI, robotics, big data, and IoT.
The government has been working on its commitment to promote digital technology as an initiative to facilitate transformation at a large scale. The shift towards digital abilities has been backed and amplified by certain other government-led tech projects. The NITI Aayog, for example, is prospecting the feasibility of AI-powered Research and Development (R&D) projects.
It seems like AI and allied innovative technologies can help India achieve its 2025 vision. For example, the integration of AI into the Ministry of Corporate Affairs portal through MCA21 mission will facilitate the government to identify and analyze any discrepancies in corporate balance sheets. Subsequently, it will help cut down the malpractices happening across the corporate ecosystem. With this, the actual contribution of India Inc to national GDP will substantially increase.
Increasing productivity in any sector will optimize a great deal to Indian GDP. The employment of artificial intelligence, Internet of Things and Machine Learning in various field is expected to add around $9 billion to the annual income of nearly 70 million of the workforce in India.
The usage of disruptive technologies can also optimize the utilization of critical and limited resources to yield better results.
As per the McKinsey Global Institute of 2018, AI itself can add $13 trillion to global economic outcomes in the next decade. This implies that being one of the prominent developing and fastest-growing economy, India has the potential, resources, and desire to capitalize on this transformation to drive exponentially accelerated growth.
Depending on the current and visible success of the IT services industry in India, the technology can further accelerate the adoption of emerging technologies in almost every sector to augment efficiency, competitiveness, quality, and productivity. The AI adoption will not only improve the quality of life but also introduce huge economic and social perks to citizens across varied demographics resulting in transforming the economic vicinity.
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