India will need to step up growth rate to become $10 trn economy: Paranjpe | Economy & Policy News

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Nitin Paranjpe

He said that while achieving this target is not easy, it is much needed and certainly possible. (Photo courtesy: LinkedIn)


India has set itself an ambitious target of becoming a $10 trillion economy and grabbing the slot of the third-largest economy by 2030, Nitin Paranjpe, non-executive chairman of Hindustan Unilever Limited (HUL), said in his speech, “Developing Human Capital for a Growing India,” at its annual general meeting. He pointed out that the ambitious goal will require the nation to step up its growth rate from a historical average of around 7 per cent compound annual growth rate (CAGR) over the last decade to over 8 per cent.


He said that while achieving this target is not easy, it is much needed and certainly possible.


Paranjpe said, “We have momentum on our side. We have been one of the fastest-growing large economies in the world over the last decade,” and added that India’s growth rate is much ahead of the largest economies—the US and the UK at 2 per cent, Japan at 1 per cent—and almost on par with China (about 7 per cent).


He also pointed out that investments made in India over the last decade have created the foundation of what is already among the best digital public infrastructures in the world, driving financial inclusion and stimulating economic growth.


“India’s unique identification programme (Aadhaar), which was launched in 2010, drove financial inclusion. That, coupled with UPI, has driven a massive step up in digital transactions in the country,” he said, and stated that India accounts for 46 per cent of all digital payments in the world.


“This, along with initiatives like the Open Network for Digital Commerce (ONDC), which have the potential to democratise commerce, makes the India tech stack, as it is called, one of the most enviable in the world. And one that will help stimulate further growth,” Paranjpe told the shareholders.


The country needs to significantly step up women’s participation in the workforce, he said.


According to Paranjpe, India’s growing working-age population could prove to be the country’s greatest asset in the next phase of its growth journey.


“With thoughtful nurturing and development, this can unlock incredible rewards for India and Indians. It is our demographic dividend—the human capital above all capital,” he said in his speech.


India has a median age of 28 years, and over 65 per cent of its working-age population is already younger compared to the US, the UK, China, or Japan, and he said that the young working-age population in these countries is likely to fall further, while India’s share of the working-age population will rise to about 69 per cent.


“India will be home to one-fifth of the global working-age population, giving us an opportunity to harness the growth of our productive labour force to boost economic development,” he said.


But he pointed out that falling birth rates and increasing life expectancy will mean that India too will start ageing, and hence the country needs to capitalise on this window of opportunity.


While talking about job creation, he said that India will need to create 90 million non-farm jobs to both manage the migration of labour from agriculture and accommodate the people entering the working-age population.


“In the coming decade, India’s service sector will present a potential for growth and employment generation,” Paranjpe said, adding that the financial services sector, driven by increasing demand in banking and insurance services, also offers opportunities for increased employment.


Other industries, according to Paranjpe, that present employment growth opportunities include health and hospitality, consumer retail services, global capability centres, and e-commerce.


He also said that the country needs to build a strong foundation in primary education, provide access to vocational skill building, make continued efforts in reskilling and upskilling the existing workforce, and retain skilled talent in the Indian economy.


Corporates also need to play a key role, according to Paranjpe. “A close public-private partnership can change the entire ecosystem by uplifting the skills and capabilities of the nation on a scale that is required for our growth ambition. To truly create a significant difference, we need India Inc. to join hands with the government.”


While talking about HUL’s participation, he said that the company’s frontline sales recently collaborated with external learning partners to upskill its teams on data-driven decision-making and understanding omnichannel engagement.


“In fact, over the years, through our value chain, we have been persevering to drive a cultural change and embrace equity and inclusion to create a truly future-fit workplace,” he said.

First Published: Jun 21 2024 | 4:21 PM IST

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