\u201cI\u2019ve been shouting from the rooftops forever\u2014if we want to become a Viksit Desh by 2047, we need more like 8, 8.5 to 9% growth, because we are still a relatively poor nation,\u201d former RBI Governor and renowned economist Raghuram Rajan said in an interview with India Today TV Consulting Editor Rajdeep Sardesai.<\/p>\n
His remarks come even as India posts strong GDP figures in a turbulent global environment. The economy expanded 7.4% in the fourth quarter of FY25 and clocked 6.5% growth for the full year\u2014figures that are well above what most major economies are managing.<\/p>\n
Rajan acknowledged that India\u2019s current growth of 6.5% is \u201ca very creditable growth rate,\u201d especially in light of postponed government spending during the election cycle and temporary statistical distortions. But he stressed that now is not the time to get comfortable.<\/p>\n
\u201cThis could be India\u2019s moment, but we have to seize it,\u201d Rajan said. He argued that India must act decisively to sustain higher growth\u2014by unlocking investment, expanding the consumption base, and ensuring businesses, both domestic and foreign, have the confidence to make long-term bets on the Indian economy.<\/p>\n
\u2018SOME SLOWING IS ON THE CARDS\u2019<\/p>\n
The biggest drag on momentum, according to Rajan, could be rising global uncertainty. He pointed in particular to Donald Trump\u2019s potential return and the unpredictability surrounding tariffs.<\/p>\n
\u201cSome slowing is on the cards,\u201d he said. \u201cWe came into this year with an extraordinary performance. But with tariff uncertainty in the US and across the world, that momentum is off the table now. If you’re a businessperson today, where do you invest?\u201d<\/p>\n
Despite this, Rajan noted a few emerging positives such as a favourable monsoon outlook, which could lift agricultural output, and the long-awaited signs of a rural demand revival.<\/p>\n
\u201cThat\u2019s a positive,\u201d he said, \u201cbecause it also reduces inequality.\u201d<\/p>\n
CROSSING JAPAN ISN\u2019T THE FULL STORY<\/p>\n
When asked about recent IMF projections that India\u2019s nominal GDP would surpass Japan\u2019s to become the fourth-largest economy, Rajan welcomed the milestone but urged a more grounded perspective.<\/p>\n
\u201cLet\u2019s not minimise the fact that we are crossing these countries, we will cross Germany at some point over the next few years. Maybe 1 or 2 years,\u201d he said.<\/p>\n