India's 2047 Growth Depends on State-Led Strategies: RBI Deputy Governor

Gupta projected that if the growth patterns of the past two decades are sustained, "the average state per capita income could approach high-income thresholds by 2046-47." She noted that "below-median states are projected to contribute substantially to this expansion, reinforcing the broad-based nature of India's growth story." This signals a shift from the earlier era of sharp income divergence toward a more inclusive and balanced development trajectory.

For above-median states, Gupta said the focus should be on "innovation and scale, planned urbanization, attracting global and domestic talent, expanding market share both domestically and internationally, and actively taking part in shaping national frameworks on trade, FDI, and finance." These states are expected to drive India's competitiveness in technology, capital markets and global supply chains.

In contrast, below-median states need to prioritize "unlocking productivity in agriculture and reimagining the sector; building skills; integrating more in the national and international labour markets, complementing more advanced states, particularly in labour-intensive activities." She also emphasized the importance of "emulating proven best practices nationally and internationally while developing niche strengths, and strengthening fiscal capacity to support faster growth."

Gupta highlighted the distinct but complementary roles of the Centre and states in accelerating growth. While "many macro policies are formulated at the national level" -- including monetary policy, financial sector regulation, trade, exchange rate and industrial policy -- states hold decisive levers over "the ease of doing business environment; land and labour market conditions; quality and reach of education and health services; delivery of public services; and enhancing the quality of public finances." She stressed that "strengthening all of these in a holistic framework would be important to accelerate the rate of growth of prosperity for each one of the states and thereby the national average."

The speech also pointed to encouraging signs of convergence in welfare outcomes. Gupta observed that "the pace of income divergence has weakened considerably with the growth gap between richer and poorer states narrowing over successive decades." At the same time, "convergence has been faster and more decisive across a wide set of welfare and development indicators: per capita consumption expenditure, literacy, nutrition, access to basic services, financial inclusion, and a range of health and gender outcomes." She said lagging states are catching up, making the distribution of wellbeing across India "more equal."

Gupta further noted that prosperity is "both India's ambition and its destiny," but the central question has shifted from whether India will prosper to how quickly, how broadly, and how equitably that prosperity is shared. Realising this potential, she said, "would require moving towards state-specific growth strategies that are anchored in local strengths, structural realities, and their respective stages of development."

She called for "holistic assessments, richer dialogues, greater awareness, specific actions across states, alongside learning from each other, to fully leverage their existing strengths and building new comparative advantages." In essence, India's Viksit Bharat vision by 2047 will be built not just on national policy reforms but on a mosaic of state-led strategies that complement each other while addressing local challenges.

- ANI