India Poised To Become World's 5th Largest Economy

By Shakir Husain NEW DELHI, Feb 2 (Bernama) -- India is poised to become the world's fifth largest economy "very soon" from the seventh position, its Finance Minister, Arun Jaitley said. Presenting the national budget for the 2018-19 financial year Thursday, he put the Indian economy's size at US$ 2.5 trillion. India is expected to grow by seven to 7.5 per cent in the coming April-March fiscal year, according to official projections. Jaitley said in the second half of the current 2017-18 financial year, the growth rate is expected to be between 7.2 per cent and 7.5 per cent. "India achieved an average growth of 7.5 per cent in the first three years of our government (Bharatiya Janata Party (BJP)-led) government. “Indian economy is now a 2.5 trillion dollar economy -- seventh largest in the world. India is expected to become the fifth largest economy very soon," the minister said. The government revised its fiscal deficit estimates upward for 2017-2018 financial year to 5.95 trillion rupees (about US$93.4 billion) at 3.5 per cent of gross domestic product (GDP). The projected fiscal deficit for 2018-2019 is 3.3 per cent of GDP. The BJP-led government announced a number of proposals for infrastructure growth and to woo rural voters before the national elections due next year. One of the key proposals would provide health insurance for 100 million poor families by covering medical expenses of up to 500,000 rupees per household for secondary and tertiary treatment. However, skepticism greeted the budget from India's strong middle-class, which had expected income-tax relief, but the tax rates were left unchanged. "The government had made many positive changes in the personal income-tax rate applicable to individuals in the last three years. Therefore, I do not propose to make any further changes in the structure of the income tax rates for individuals," Jaitley said. Expenditure on infrastructure for 2018-19 has been increased to 5.97 trillion rupees compared with the estimated expenditure of 4.94 trillion rupees in 2017-2018. The minister said India's infrastructure investment requirements were around US$785 billion "to increase growth of GDP, connect and integrate the nation with a network of roads, airports, railways, ports and inland waterways and to provide good quality services to our people." -- BERNAMA