NEW DELHI : India will need to sustain an average annual nominal growth rate of 9.25 percent for the next 21 years to achieve developed-country status by 2047, NITI Aayog Vice-Chairman Ashok Lahiri said at an event organised by the National Council of Applied Economic Research.
Lahiri said the target hinges on lifting per capita income from an estimated $2,813 in 2026 to around $18,000 by 2047, a more than six-fold jump. The goal is achievable but only with rapid, sustained reform, pointing to Japan, South Korea, Taiwan, Hong Kong, Singapore, and China as economies that pulled off comparable growth surges on their own path to developed status. “Others have done it, so can India, but it needs support through rapid reforms,” he said.
Lahiri, who took charge at NITI Aayog in April, flagged land and capital market imperfections as major structural blocks holding back investment, calling for land acquisition to be made easier for both industrial projects and government infrastructure work, which he said currently suffers from legal delays and bureaucratic friction at the grassroots level.
He described entrepreneurship as a “hidden asset” India hasn’t fully leveraged, arguing that easing the basics of doing business would let both domestic and foreign capital flow in naturally, in search of returns.
On savings, Lahiri noted India’s savings rate peaked at 37 percent back in 2007, fell to 29 percent in 2020, and has since recovered to around 35 percent in 2025, but continues to trail China by 10 to 15 percentage points.
He linked that gap to a persistent current account deficit, $16.5 billion in 2025, in contrast to the surpluses China, Korea, and Singapore have managed to sustain. He also pushed back directly on the idea that India suffers from weak consumer demand:
“You can’t be talking about the savings rate being too low and at the same time saying under-consumption is there,” he said, arguing that investment itself generates the demand critics claim is missing.Gross fixed capital formation in India has stayed below 30 percent of GDP for most recent years, Lahiri noted, compared to 35 percent or higher sustained by East Asian economies during their own high-growth phases, a gap he framed as central to closing the distance to the 2047 target.
On foreign investment specifically, he pointed out that while gross FDI stayed robust at $95 billion in 2025-26, net FDI has remained comparatively muted due to rising repatriation and outbound investment from Indian firms, though early signs of recovery are visible, net FDI flows hit $7.4 billion in April 2026, up sharply from just $1.6 billion in the same month a year earlier.
Lahiri’s list of long-term priorities for reaching Viksit Bharat status included education, health, infrastructure, and entrepreneurship, alongside administrative reform, stronger law and order, and a faster justice system, areas he described as his personal focus as NITI Aayog’s new vice-chairman.
