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India GDP to touch USD 2.5 trillion by 2021

India's real GDP is expected to touch USD 2.5 trillion by 2021 as the country's macroeconomic fundamentals, like savings, investments and per capita income, are growing strong. At present the country's real GDP amounts to USD 1 trillion.

Industry body PHDCCI in its study, 'Growth Prospects of Indian Economy: Vision 2021, Trillion Dollar Growth Opportunities' said India's real per capita income is estimated to double from the current level of USD 900 to USD 1,800 by 2021.

It said that "The strong macroeconomic fundamentals of India, like savings, investments and per capita income, are growing strong and would drive the growth prospects.”

Notwithstanding that real GDP growth is expected to moderate in the near term to around 7.4 to 7.7% in 2011-12, it is projected to enter a higher growth trajectory in the next few years.

It added that the real GDP is estimated to achieve an average growth of 9.3% in the next 10 years by 2021.

Mr Sandip Somany president of PHD Chamber said that despite the fact that the slowdown in advanced economies, coupled with domestic economic challenges like high inflation and borrowing costs, have pulled down the growth momentum in the near term, India has emerged a leading economy in the world economic system.

The study also said average WPI inflation is projected to remain within the 5 to 6% trajectory, while the gross fiscal deficit is estimated to remain within 3 to 4% of the GDP by 2021.

India's exports of goods and services are projected to expand to USD 1,500 billion by 2021, while the average current account deficit would be less than 1% of the GDP.

Furthermore, the country's demographic dividend would place it among the fast moving economies in the global economic order.

It said that the infrastructure sector has a huge untapped potential and will be the main driving force for higher economic growth adding that India will be spending around 9 to 10% of its GDP on the sector during the 12th Plan. In addition, it said developments in the global economy over the past few months are a matter of serious concern.