The Indian economy is shaping up in a positive way and all structural reforms are opening up now, former SEBI and LIC chairman G N Bajpai said on Sunday.
He said the likely recession will impact the country very marginally. "A likely recession will impact India, but very marginally, because our exports are not that much affected. Indian economy is majorly driven by domestic factors," he said at the second leg of the Business Today Golf event of the 2022-23 season.
This comes after global consultancy firm EY announced its growth projection for India and estimated Indian economy will reach a GDP size of $26 trillion by 2047, the 100th year of India’s independence. The per capita income is expected to increase to $15,000, putting the country among the ranks of developed economies, said EY.
With strong services exports at $254.5 billion in 2021-22, India enjoys a strong foothold, especially in the IT and BPO services exports, the report titled "India@100: Realising the potential of a $26 trillion economy" highlighted.
There is now an opportunity for the country to seize a higher share of transformational and more complex, expertise-based services to grow faster in the IT services sector, said EY.
Talking about the upcoming Union Budget, Bajpai said that the current political executives have been conducting themselves very responsibly in the matter of fiscal deficit. Notwithstanding the fact that the general election is around the corner, he said, this will continue even moving forward."Fortunately for them, there is a good growth in the revenues so they have a levy to keep pushing infrastructure investments," he added.
The former LIC chief also said that India's insurance penetration is bound to increase exponentially. "The economy is doing well and people have more money to put into an investment," he said.
"The current Insurance Regulatory and Development Authority (IRDA) chairman Debashish Panda is of a very progressive mind. He has been trying to liberalise in order to help grow the industry fast," Bajpai said.
Speaking at the BT Golf event, he also underlined how the game helps him in his professional life."Golf is a mind game and involves great management," he said, adding that it's all about thinking, deciding what needs to be done, and considering the "strokes" accordingly.
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FAQs
He said the likely recession will impact the country very marginally. "A likely recession will impact India, but very marginally, because our exports are not that much affected. Indian economy is majorly driven by domestic factors," he said at the second leg of the Business Today Golf event of the 2022-23 season.
Why will recession not hit India? ›
India's growing forex reserves and declining levels of external debt as a percentage of its GDP have increased the resilience of the Indian economy. The stability of India's financial position, its large domestic market and its improving business climate continue to attract long-term capital from across the globe.
What is the main reason for recession in India? ›
Except for the Pandemic time, the reasons for a recession in India include bad monsoon conditions, energy crisis, and global recessions. A falling economy for two consecutive quarters can be considered a recession, but there are no defined measures to rate and identify the cause of the recession.
What happens to India if US goes into recession? ›
As US consumers tighten their belts, imports of Indian goods like garments, textiles, and pharmaceuticals might decrease, leading to lower growth in these sectors. Global Trade slowdown: A US recession can trigger a broader global slowdown, further impacting demand for Indian exports across various markets.
Is recession coming in 2024 India? ›
The 2024 recession in India is not a solitary event but a convergence of global economic shifts, technological disruptions, and policy decisions. Understanding these factors is pivotal as businesses, especially in the IT sector, grapple with challenges like reduced spending, project delays, and heightened competition.
Will India benefit from US recession? ›
The Biggest Effect Of The U.S. Recession On The Indian Rupee: The biggest effect of the U.S. recession on India was the depreciation of the Indian Rupee. The increase in demand for dollars caused the appreciation of the U.S. dollar in terms of rupees. That is why the Rupee depreciated against the U.S. dollars.
Is India going through a recession right now? ›
India retains its position as the fastest growing nation in the world. The International Monetary Fund (IMF) said in its latest World Economic Outlook update the economic growth in India was projected to remain strong at 6.5 per cent in both 2024 and 2025.
How much a US recession will hurt India? ›
India Impact
"If the US sees a recession. Our IT services industry and our business services exports could be hit. Services exports make up 10% of India's exports. If they fall a lot, we could lose 1% of GDP growth," he said.
How can we control recession in India? ›
Additionally, during a recession, the Reserve Bank of India (RBI) may take measures to stimulate the economy, such as reducing interest rates or increasing liquidity in the market. These actions can impact the yields on government bonds, which are considered safe-haven investments.
Will there be recession in 2025 in India? ›
“Growth in India is projected to remain strong at 6.5 per cent in both 2024 and 2025, with an upgrade from October of 0.2 percentage point for both years, reflecting resilience in domestic demand," the IMF said in its latest report that was released in South Africa.
The interconnectedness of global trade is undeniable, and India is not immune to the repercussions. Six major countries facing recession risks collectively account for over 10% of India's total trade. For instance, India's trade with the UK represents about $11.4 billion, approximately 2.5% of its total exports.
How long will the US recession last? ›
ITR Economics is the oldest, privately-held, continuously operating, economic research and consulting firm in the US. ITR Economics is forecasting that a macroeconomic recession will begin in late 2023 and persist throughout 2024.
Is the US in a recession 2024? ›
The New York Stock exchange (NYSE) at Wall Street, Jan. 31, 2024, in New York. A forward-looking measure of the U.S. economy continued to decline in January but importantly it is no longer signaling a recession in 2024, reflecting an economy outperforming expectations.
What happens in the 2024 recession in India? ›
Amid the optimism of RBI on GDP growth, the government has flagged that recession risks may reappear in 2024 mainly due to current uncertainties linked to rising food and energy prices amidst lingering geopolitical tensions.
Which country are in recession? ›
Along with the UK and Japan, Ireland and Finland also went into technical recessions in the fourth quarter. Ireland registered a quarter-on-quarter GDP contraction of 0.7 per cent and 1.9 per cent in Q3 and Q4 respectively. On the other hand, Finland's GDP shrank by 0.4 per cent and 0.9 per cent in the same periods.
Why is Japan in recession? ›
Another key factor behind Japan's sluggish growth is stagnating wages that have left households reluctant to spend. At the same time, businesses have been invested heavily in faster growing economies overseas instead of in the aging and shrinking home market.
Will recession end in 2024? ›
Economists predict another year of slow growth around the world in 2024. While the risk of a global recession is lower in the year ahead, two G7 economies dipped into recession at the end of 2023.
What will happen if US goes into recession? ›
Recessions reduce opportunities: failed businesses, fewer jobs, and lower wages. Recessions normally don't happen every year, but they're not unusual.
