Is there a zero chance of a recession in India?

There is zero chance of a recession in India

Global economies are creating recession fear and questions from economists are being raised. So what will be the position of India in the fear of recession? Here is the article, written by Prahlad Sabnani, (Retired Deputy General Manager), State Bank of India. He mentions those areas in this article that are keeping India away from economic slowdowns.

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India is home to many such areas that can grow continuously and export more goods overseas. Actually, India has spent the last 8 years, taking an important decision have been taken in the economic field, whose impact is now clearly visible in various sectors of the economy. Exports from those areas which were till now almost entirely dependent on imports are also gaining momentum. Such as the toy industry, safety equipment manufacturing industry, pharma industry, information technology, auto industry, etc.

More recently, economists of Morgan Stanley, American multinational investment management and financial services company, have released a report saying that in the financial year 2022-23, India will emerge as the most robust economy in Asia. According to their estimates, the Indian economy will achieve a growth rate of more than 7 percent in the financial year 2022-23, which will be the highest among the largest economies in the world. Also, India can contribute 28 percent and 22 percent respectively to the growth rate of Asian and global economies. India has a strong potential to generate solid economic demand. In India, Economic reform programs are also being implemented rapidly. The country has a substantial youth labor force and investment in the business is increasing continuously. According to a survey recently completed by Bloomberg, there is zero chance of a recession in India between the Kovid epidemic and the Russia-Ukraine war, while many developed and developing countries are also facing the problem of recession. This can be called good news for India.

India is also preparing to export BrahMos missiles to many countries of the world like the Philippines, Vietnam, and Indonesia soon. Some other countries like Saudi Arabia, United Arab Emirates, South Africa, etc. have also shown their interest in buying BrahMos missiles from India.  The BrahMos missiles, three times the speed of sound, the speed of Mach 3, and the range of 290 km, are a classic example of Indo-Russian military cooperation. The advantage of BrahMos is that can be launched from any launch equipment located on land, sky, and sea and it is the only cruise missile of its kind. Today, defense equipment is being exported from India to more than 84 countries.  The list also includes countries like Qatar, Lebanon, Iraq, Ecuador, and Japan to which India is exporting body-protecting equipment, etc.

IT Sector

India’s information technology industry, which came into existence in the 1970s, is setting new dimensions in the country and the world today. According to a 2022 report by the industry body NASSCOM, the IT sector is likely to witness a growth rate of 15.5 percent this year. Today, about 50 lakh people are directly employed in the IT sector. About 18 lakh women are involved and the size of the IT sector is more than $ 200 billion. 451 Research reported that women now account for 34% of the IT workforce in India, with STEM graduates having a 50:50 gender parity. With the way India’s IT sector is progressing, the day is not far when Indian companies will be included in the world’s largest IT companies.

India’s electronic vehicle market is also growing at a very fast pace.

India’s electronic vehicle market is also growing at a very fast pace along the lines of the information technology industry. According to the latest report by India Energy Storage Alliance (IESA), India’s electric vehicle market will grow at a rate of 49 percent between 2021 and 2030. Not only this, but the annual sales of these vehicles are also likely to be up to 17 million units. The demand for lithium-ion batteries in India is expected to grow at a compound annual rate of 41 percent to 142 GW by 2030. In the domestic market, electronic vehicles account for 50 percent of the two-wheeler sales in the form of about 4.67 lakh units. Lead acid batteries accounted for 81 percent of the demand for e-rickshaws in India in the year 2021.

Apart from the above-mentioned sectors, exports from India are consistently achieving impressive growth rates in many other areas as the demand for Indian products is increasing all over the world. That is why the Government of India has set a target to take the exports from India to two trillion US dollars by 2030. For this, efforts will be made to make 100 Indian products of India as global champions and economic zones will be set up across the country. 67500 crores of goods and services exports of the country in the year 2012-22  US dollars, which has been set to take the target to 2 trillion US dollars by 2030. For which continuous free trade agreements are being made with foreign countries. After achieving the above target, India will be among the first three-four countries to contribute to foreign trade world trade by the year 2030.

Toy products and defense products as well as in areas such as technology, information technology, automobiles, pharma, mobile manufacturing, renewable energy, digital systems, infrastructure development, start-ups, drones, green energy, and space, India is rapidly establishing itself on the global stage.

Due to the fast-growing economy in India and the all-around progress in exports and the sufficient amount of foreign exchange reserves available in the country, global economic institutions are constantly giving the impression that there is possibility of a recession in India is almost zero.