India 2020

India will become a $5.6-trillion economy, from $1.73 trillion in FY11, by 2020, according to research firm Dun & Bradstreet, which has predicted a three-fold jump in the country’s GDP from $1.7 trillion last fiscal on the back of rapid investment and growing consumer expenditure. The rate of investment, consumer expenditure and infrastructure spending will be the driving force behind the country’s economic growth over the next 10 years, D&B economist Arun Singh said, adding that these conclusions are part of a report which is scheduled to be released tomorrow. The share of discretionary spending is projected to increase considerably to 72% of private consumption expenditure from around 60% in FY10. Besides, the share of the services sector is expected to surge from 57% of the GDP in FY10 to 61.8% in FY20. Another major contributor to the growth would be rapid investment in the infrastructure area. Infrastructure sector spending is expected to rise to 12% of the GDP by FY20 from around 7% of the GDP in FY11. In terms of regions, eight states—Maharashtra, Gujarat, Andhra Pradesh, Bihar, Madhya Pradesh, Rajasthan, Orissa and Uttar Pradesh—would contribute 71% of the total GDP in the next 10 years, as compared to 66% in FY10. Further, the report said Maharashtra, Gujarat and Andhra Pradesh will be amongst the most developed states in the country by 2020 and would together contribute 32% to the overall GDP.