ECONOMIC REFORMS AND GROWTH PROSPECTS: INDIA'S AGENDA FOR THE GLOBAL ECONOMY

India's economy is of global importance with a large young population and an open and democratic political system. It is already the third-largest economy and contributor to global economic growth, yet there is considerable untapped potential.

- Neeta Baporikar

Introduction

With more than a sixth of the world's population, India produces only 7 per cent of the world's output. India has enjoyed a step up in growth rates over the past few decades supported by reform efforts and the expansion of its aspirational, consumer class. Given the challenges of policymaking in such a large, diverse country with a federal structure of government, reforms will likely proceed incrementally and be politically opportunistic where the central and state governments have important roles to play.

Economic Reforms and Growth Prospects

India's growth path will be driven by how effectively it harnesses and rewards the efforts of its greatest natural asset - its people. India has the second largest population in the world with more than 1.3 billion people. India's largest state, Uttar Pradesh, is bigger than Brazil, the world's fifth most populous country. Within the next decade, India's population will overtake China's to become the world's largest. By 2035, the United Nations projects that India's population will have reached almost 1.6 billion people, on its way to a peak of almost 1.7 billion by the early 2060s. India is the world's third largest economy measured in purchasing power parity (PPP) terms and, on some measures, will be the fastest-growing large economy in the world in the coming years. India's population has benefited from this strong economic performance.