New Delhi [India], April 8 : India Ratings and Research (Ind-Ra), has recently unveiled an analysis projecting Maharashtra, Karnataka, and Gujarat as frontrunners in India's race toward achieving the monumental milestone of a trillion-dollar economy by fiscal year 2039.
Dr Sunil Kumar Sinha, Principal Economist at Ind-Ra, emphasized that these states are poised to lead the charge into the upper echelons of economic prosperity, driven by robust growth trajectories and strategic initiatives.
The analysis, presented in a recent publication by Ind-Ra, forecasts that India's economy is on track to ascend to the upper-middle-income category between fiscal years 2033 to 2036, eventually culminating in a USD 15 trillion economy by fiscal years 2043 to 2047.
Dr Sinha underscored that Maharashtra, Karnataka, and Gujarat are anticipated to spearhead this transformative journey, with projections indicating their ascent to the coveted trillion-dollar club by fiscal year 2039.
Dr Sinha said, "Similar estimates at the sub-national level reveal that of the 28 states, Maharashtra, Karnataka and Gujarat would be the first ones to achieve the USD1 trillion mark and this would happen in FY39."
Nominal Gross State Domestic Product (GSDP) growth estimates for Maharashtra, Karnataka, and Gujarat stand at 5.5 per cent, 8.4 per cent, and 8.3 per cent, respectively, mirroring the growth patterns observed between fiscal years 2016 and 2023.
Maharashtra, in particular, aims to achieve the trillion-dollar milestone by fiscal year 2028, necessitating an extraordinary Compound Annual Growth Rate (CAGR) of 18.0 per cent in nominal GSDP from fiscal years 2024 to 2028.
Similarly, Gujarat and Karnataka are striving to reach the trillion-dollar mark by fiscal years 2031 and 2033, respectively, requiring CAGRs of 17.4 per cent and 13.5 per cent in nominal GSDP from fiscal years 2024 onwards.
Paras Jasrai, Senior Analyst at Ind-Ra, highlighted that beyond Maharashtra, Karnataka, and Gujarat, Tamil Nadu is positioned to join the trillion-dollar league by fiscal year 2041, provided it sustains its estimated nominal GSDP growth of 7.2 per cent.
Jasrai said, "Ind-Ra's estimates further show that India would have eight sub-national economies which would hit USD1 trillion mark by FY47."
Additionally, Uttar Pradesh (UP) is poised to emerge as a key player, aiming to reach the trillion-dollar milestone by fiscal year 2042, contingent upon a nominal GSDP growth CAGR of 7.1 per cent.
While acknowledging the ambitious targets set by these states, the agency emphasized that achieving the trillion-dollar mark within the stipulated timeframe presents formidable challenges.
Nevertheless, Ind-Ra's estimations suggest that states like Madhya Pradesh, Telangana, and Andhra Pradesh may also attain trillion-dollar economies before fiscal year 2047, provided they maintain nominal GSDP growth rates akin to those observed between fiscal years 2016 and 2023.
Moreover, Ind-Ra's analysis delved into the evolving landscape of state economies, elucidating notable shifts in economic rankings and per capita income profiles.
The top five state economies in the fiscal year 2023 remained consistent with the fiscal year 2014, albeit with the reordering of ranks. Karnataka ascended to the third-largest state economy, surpassing Uttar Pradesh, while Maharashtra, Tamil Nadu, and Gujarat maintained their positions among the top five.
In terms of per capita income, Goa and Sikkim emerged as frontrunners, with nominal per capita incomes exceeding three times the national average in fiscal year 2023.
Telangana and Karnataka followed suit, displacing Haryana and Uttarakhand in the top rankings from fiscal year 2014.
Mizoram showcased significant progress, ascending to the top 10 states in terms of per capita income, indicative of substantial economic growth and development.
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