Roadmap for Indian Economic Growth

The Standing Committee on Finance examined the roadmap for Indian economic growth in light of global circumstances to identify strategies for achieving sustained prosperity. This matters to citizens as it outlines necessary economic shifts, such as increasing investment and improving infrastructure, to support long-term growth.

The report concerns the Ministry of Finance and the broader Indian economy, affecting sectors including manufacturing, MSMEs, agriculture, banking, infrastructure, and energy.

• The Committee noted that India needs 8% real GDP growth annually for a decade to achieve sustained prosperity, requiring investment as a share of GDP to rise from 31% to 35%.
• For manufacturing, the Committee recommended enhancing competitiveness, increasing R&D investment, negotiating trade agreements, expanding PLI scheme support for high-tech sectors, and diversifying the investor base for FDI.
• For MSMEs, the Committee recommended promoting digital credit assessment, deepening credit penetration in underserved regions, scaling digital tools for market linkages, simplifying disclosure norms for listed MSMEs, and prioritizing labour-intensive MSMEs for employment.
• For agriculture, the Committee recommended promoting crop diversification, strengthening supply chain infrastructure, and encouraging private sector participation in agri-tech to target supply-side inflation and boost farmer incomes.
• For price stability, the Committee recommended strengthening supply chains via cold storage and digital market linkage, implementing regulatory reforms from the Union Budget 2025-26, and simplifying compliances under the Jan Vishwas Bill 2.0.
• For the banking sector, the Committee highlighted the structural challenge of credit growth outpacing deposit growth and recommended encouraging deposit mobilisation, strengthening risk management, and extending stress testing to NBFCs and cooperative banks.
• For infrastructure, the Committee recommended boosting capital expenditure while maintaining fiscal discipline, addressing challenges like high logistics costs and environmental clearance delays.
• For energy transition, the Committee recommended accelerating investments in diversified renewable energy, strengthening mineral supply chains, and promoting the transition to electric vehicles.

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