India set to double GDP in five years.

Given the fast pace at which India’s $1.3 trillion economy is growing at present, the country is on track to double its gross domestic product in five years, Anand Sharma, India’s Minister for Industry and Commerce, said.

Asia’s third largest economy, which is already the world’s fourth in terms of purchasing power parity, is also poised to emerge as “the manufacturing hub of the world,” thanks to huge investments the country’s vibrant industrial sector is drawing from within and abroad, the minister said in an interview with Khaleej Times at his office in New Delhi.

Sharma, who is expected to arrive in Dubai today to take part in The India Show, which opened on Tuesday at the Dubai International Convention and Exhibition Centre, contended that the “richness of human resources and the demographic dividends” would be one of the biggest strengths of India in the coming decade.

“Two-thirds of our population is young. We will have close to 200 million people joining the work force within a decade,” Sharma pointed out.

The Indian minister maintained that a consistent thrust in the manufacturing sector and the ongoing investments in industries would eventually make India a manufacturing hub of the world.

“We are an ancient nation but also very upcountry. India is a land of opportunities. Today the pace at which the Indian economy is growing is remarkable. Our GDP is set to double in the next five years,” he said.

The minister’s upbeat outlook on India’s growth prospects have been backed by the latest forecasts by the World Bank and other global entities, all showing India outpacing even the most optimistic growth projections.

A World Bank update, analysing the economic situation in South Asia, forecasts better prospects than earlier expected for the India’s economy. It says that the economic growth may go beyond the projected eight to nine per cent in the next two years.

“India’s recovery after the slowdown is well under way. Growth is projected to recover to eight to nine per cent in the next two years. The recovery of Indian GDP could be even faster than what is projected,” the World Bank’s South Asia Economic Update said.

Edelweiss Capital in its latest research report “India 2020, Seeing Beyond,’ said India’s GDP was likely to quadruple over a period of 10 years. It further states that India is likely to be a $4.5 trillion economy by 2020 driven by a nominal annual growth rate of 13 per cent.

The Asian Development Bank also sounded very bullish in its latest report, and argued rising private consumption and investment would support India’s economic growth in the next two years, with the country’s GDP forecast to grow by 8.2 per cent in 2010 and 8.7 per cent in 2011.
UAE-India trade ties

On India’s trade ties with the GCC and the UAE, Sharma said the region was an important economic partner of India.

“The UAE and its extended neighbourhood is an area with which India has had historic and cultural links. Trade and exchange of people and people-to-people contacts have been taking place for centuries. Our relationship has been very enriching, and we are very keen to bolster the                     bonds further.”

The UAE, one of India’s largest trade partners, is also home to 1.7 million Indians. India’s exports to the UAE surged 56 per cent to $24.47 billion in 2008-09, data by the Federation of Indian Exports Organisations show.

“The UAE is one of the largest trading partners of India, and before the economic recession impacted economies and markets, we were heading towards $50 billion bilateral trade. However, it reached a little over $48 billion last year. I am sure that we will be able to go back to that higher trajectory this year given India’s diverse strengths — the profile of its industry, its strength in some of the core sectors, its accomplishments in information technology and communications, as well as its advancements in pharmaceutical and healthcare sectors and also manufacturing and engineering, including automobiles.”

With a targeted 15 per cent global exports growth this year, India has set a long-term policy objective to double the per centage share of this country in world trade by 2020. India’s exports rose an annual 36 per cent in April to $16.9 billion, the sixth consecutive rise after 13 straight months of decline, government data showed on Tuesday.

Sharma said the India Show in Dubai sought to provide a glimpse of India and its vast and varied strengths in products and services as well as the manifold opportunities for investment the country provides. “The show is not only about industry and production but much more as a showcase of the coutry’s soft power including India’s culture, its music, its cuisine, its places of historical importance and also its entertainment industry, which is one of the biggest in the world. Bollywood is already popular in the Middle East through Indian music and films and we are the largest film producing country in the world.”

Sharma said the India Show would best staged in different parts of the world. “It is basically designed to create a platform to inform a larger constituency of stake-holders, who have not only admiration for India and its people but also interest in engaging with our industry and our commerce.”
Free trade talks

Sharma said he was looking forward to engaging with the ministers and leaders of governments to take forward the India GCC free trade talks.

“We had, in fact, earlier this year met with ministers from GCC countries who came to New Delhi as part of delegation to India-GCC forum. This region, as I said, is very important. The UAE is a gateway to Iran and Iraq, and beyond that to other Middle Eastern countries. Dubai is an important commercial and cultural hub.”

The Indian minister, however, declined to give a timeline for concluding the free trade talks. “Negotiatons always take time because these are complex. They cover different subjects, issues.”

He said even in the absence of a free trade pact, two-way investments have been growing. “We believe a comprehensive economic cooperation agreement between India and GCC countries will further enhance economic engagements, leading to higher investments and create an environment in which more partnerships and more joint ventures can be built in multiple industrial sectors.”

On world trade talks, Sharma is of the view that “what the world needs is not the present tendency of protectionism with countries trying to look inwards, especially now, with the contracting of major developed economies. This is the time to bring down existing barriers, not create new ones, since robust global trade in a multilateral trade regime will accelerate the process of recovery while the reverse will slacken the pace.”
More FDI from Gulf

He said India was keen to attract more foreign direct investments from the Gulf.  “India plans to have more huge investments in infrastructure. In the next one decade the projected investments in infrastructure expansion is $1.7 trillion.” Other major areas that offer great opportunities for foreign direct investment include real estate, housing development and industries.”

He said cross-border investments between Indian corporates and their counterparts from across the globe are on the upswing. In fact some of the recent biggest corporate acquisitions and mergers saw Indian corporates playing a central role. Indian corporates, both public and private sectors have stepped out. They are investing in other countries and continents. There is no more geographical

Source :- khaleejtimes.com/biz