New Delhi, Mar 26: India is on track to double the size of its economy to $5 trillion by 2025, the finance ministry said on Monday while asserting that the inflation target set by the Reserve Bank will not be breached.
The country is well poised to click a growth rate of 7-8 per cent and with focus on start-ups, MSMEs and infrastructure investment it can step on to higher growth pedestal, Economic Affairs Secretary Subhash Chandra Garg said.
“I think it is very reasonable to expect, if the economy remains focused on producing goods and services and generate demands for next 7-8 years…we can achieve the level of $5 trillion of the economy by 2025. That’s the reasonably set goal,” Garg said at the CII Global Industry Associations Summit.
India’s GDP in value terms currently stands at $2.5 trillion — making it the sixth largest economy in the world.
With regard to inflation, Garg said its trajectory is well within the RBI’s target of 4 per cent, plus/minus 2 per cent.
“We have been extremely successful in adhering to that (inflation target) and going forward also I don’t see any major risk in not adhering to that,” Garg said.
The wholesale price index-based inflation fell to a 7 month low of 2.48 per cent. The consumer price based retail inflation was also at 4 month low of 4.44 per cent in February.
The RBI takes into account retail inflation while formulating its monetary policy.
In its last policy in February it kept interest rates unchanged citing inflationary concerns.
“The macroeconomic factors, including inflation, I don’t see any risk to our USD 5 trillion economy target. We have very stable inflation,” Garg said.