Raghuram Rajan: Can India grow rich before growing old?

“By 2047-2050 we are going to start growing old. Are we going to be rich by then? Not at 6-6.5 per cent growth,” he said.

| Updated: 20 May, 2024 4:01 pm IST

NEW DELHI: Raghuram Rajan, former Reserve Bank India governor has shared his view-point on India’s unemployment figures with the media. During a recent discussion,he raised concerns whether India would grow
old before Indians become rich with the current real GDP growth predicted at 6-6.5 per cent by the year 2047-50.

He added, “Even if India is the fastest growing economy in the G20, it is also the poorest country. Young people are coming into the labour force in massive quantities. If we could employ them, India would grow much faster”.

According to, the Periodic Labour Force Survey (PLFS) Annual Report 2022-2023 released by the Ministry of Statistics & Programme Implementation, in rural areas, the Labor Force Participation Rate (LFPR) increased from 50.7% in 2017-18 to 60.8% in 2022-23. Similarly, in urban areas, it rose from 47.6% to 50.4%. For males in India, LFPR increased from 75.8% in 2017-18 to 78.5% in 2022-23, while the corresponding increase for females was from 23.3% to 37.0%.

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In context with China, Rajan said, “Relative to the rich countries, we look really good. Also, we have a large population, so we are overtaking countries in terms of overall GDP. We have just overtaken the UK, India is the fifth-largest economy. Soon, India will overtake stagnant Japan and Germany to become the third-largest economy.”

Germany has positioned itself as the third largest economy of the World, Japan trails behind at 4th in terms of GDP. In the 2024 World According to the report released by the International Monetary Fund (IMF), Japan’s real GDP growth rate is 0.9% of their GDP. Germany has seen a 0.2% real GDP growth rate as per the IMF, while India’s growth rate stands at 6.8% of the real GDP.

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Raghuram Rajan also praised PM Modi over infrastructural growth in the Country and said, “If you want roads to be built, railways to be built, that centralised coordination happens well with a more authoritarian government, which is what the Modi government is”.

He also reflected his views on equality in job opportunities and said, “No country has ever succeeded by treating a large part of its population as second-class citizens. They should get the sense of progress, that things are getting better. You cannot reverse the environment of equality that India has enjoyed since independence”.

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