Of Competitive Federalism....

Prime Minister Narendra Modi wants the Uttar Pradesh government to compete with Maharashtra in the race to become India’s first trillion-dollar state. Speaking at the Uttar Pradesh Investors Summit in Lucknow, Modi said the Maharashtra government has set itself the target to become the first state to achieve a trillion-dollar economy.

“Can there be a competition between Uttar Pradesh and Maharashtra to achieve the target of trillion-dollar economy, first? This kind of competition will lead to development and generation of employment. Besides, this kind of healthy race will strengthen the spirit of competitive and cooperative federalism,” Modi said.

According to the Central Statistics Office, the size of the Maharashtra and Uttar Pradesh economies was $308 billion and $172 billion, respectively, in 2015-16. In 2016-17, UP became a $196 billion economy, while data for Maharashtra is not available for that year.

Speaking at the Magnetic Maharashtra global investment summit on Monday, Modi said when India’s economy joined the $1 trillion club, it created headlines. “But later everything went down in scams and there was talk about Fragile Five. Now, in the last three years, the talk has gained traction and credence that India could well join the 5 trillion dollar club,” Modi said.

Morgan Stanley, in a report published last year, said the Indian economy will become a $5 trillion economy by 2025. The Indian economy is estimated to be a $2.56 trillion economy in 2017-18.

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