Double Engine Set To Fire Growth

CENTRE’S HEAVY-LIFTING of the Indian economy via sustained capital expenditure for the past few years has been able to keep India’s economic engine moving — but only so much. The other three engines that power GDP growth — private sector investment, consumption and exports — have hopelessly lagged behind.

Budget 2024-25 takes a shot at at least two of those, consumption and private investment, to break the deadlock persisting since well before Covid. Tech disruption and resultant job losses had kept masses from opening their purses for consumption of goods and services. That triggered a cycle of low capacity utilisation in various industries in the economy, making private sector circumspect about creating new greenfield capacities. It’s been hard to break this vicious cycle. With exports dependent entirely on the vagaries of the global economic performance, finance minister Nirmala Sitharaman has moved to control the controllables within our borders — consumption and private investment.

A brand new ₹2 lakh crore employment and skilling scheme for first-time employees is meant to create fresh opportunities and formalisation of the economy with around 1 crore new jobs every year whose earnings could potentially trigger consumption of goods and services at greater scale. This has been complemented with tax breaks for the middle class, leaving more disposable income in their hands for consumption.

Meanwhile, new proposals to encourage MSMEs, PPP projects, invitation for large investments in space, housing and infra are all aimed at making investment attractive for the private sector. Read Ashutosh Kumar’s analysis of the great push for consumption and private investment.

Meanwhile, India’s infrastructure juggernaut is taking greater intensity in Modi 3.0, carrying on the legacy of Centre’s capital expenditure-led growth: India’s biggest port — bigger than all existing ports put together — is planned to be set up at Vadhavan (first phase by 2029); 60,000 km of high-speed highways on the lines of the Delhi-Mumbai Expressway; 50% railway network expansion to 90,000 km to eliminate all waiting lists; 3 crore houses under the PM Awas Yojana are just some of the mega infra projects on the anvil. Read about the projects, their timelines and the funding challenges in this account by Ashutosh Kumar.

Elsewhere in the issue in your hands, thanks to concerted effort at the ground level — both by feisty entrepreneurs from locations such as Kanpur, Bareilly, Alappuzha and Kochi, and the government — ayurveda is seeing acceptance of enormous proportions in medical treatment.

In this era, it’s taken the form of ultra-modern products such as gummies and tablets, patented AI-based pulse diagnosis equipment based on ayurvedic principles, online pharmacy, ayurveda doctor consultancy platform, digital ayurveda database as AYUSH treatment comes into its own. Read the earliest story capturing this fascinating trend by Joe C. Mathew.

The special package this issue is the India list of Fortune’s iconic global ranking of ‘Most Powerful Women’. Read those stories of grit, gumption and outstanding achievements of women leaders who made the biggest impact on business and economy in 2023-24.