When Prime Minister Narendra Modi asked, in January this year, the question, "India is a $2 trillion economy today. Can we not dream of an India with a $20 trillion economy?", he was echoing a powerful, nuanced and intensely compelling set of questions. Some among them-ranging from ease-of-doing business, innovation, digital economy, manufacturing, entrepreneurship to skilled workforce-are all too familiar.
1. Tax digital MNCs - software majors, social media, search engines etc - including e-Commerce players.
2. Capitalise cash burn, tax Inheritance, asset monetisation and speed disinvestment to generate revenue.
3. Structural reforms necessary to do higher than 6 per cent and to reach the $10 trillion target set by @narendramodi.
The Prime Minister's vision of India becoming a $5 trillion economy by 2024 has inspired every citizen to contribute to this worthy cause. In his words, "If every one of the 130 crore Indians takes one step forward, the country too will go that many steps ahead". The Economic Survey had extended its absolute commitment to this collective endeavour of fructifying the Prime Minister's vision.
The GDP growth rate is determined by two factors: the investment rate and the efficiency in the use of capital. The Harrod-Domar equation defines the relationship: the growth rate is equal to the investment rate divided by the incremental capital-output ratio (ICOR). The ICOR measures the capital required to produce one unit of output.