With young workforce and continuing policy reform, India has not only emerged as the fastest-growing economy, but its stars also shine bright amid the current global gloom, International Monetary Fund (IMF) Managing Director Christine Lagarde said last week.
“It’s fitting we meet in India,” said Lagarde in her remarks at at “Advancing Asia” summit here. “It’s the world’s fastest growing large economy, on the verge of having its largest, youngest ever workforce — and, in a decade’s time, set to become the world’s most populous country.”
She also announced a training and technical assistance centre here for capacity development.
With Prime Minister Narendra Modi at the podium, Lagarde said it was an opportune time to toast India’s achievements — and Asia’s achievements — which, she added, was a rare bright spot in this current global economic turmoil.
“India stands at a crucial moment in its history — with an unprecedented opportunity for transformation. Important reforms are underway. Think, for example, of ‘Make in India’ and ‘Digital India’. With promise of more reforms to come, India’s star shines bright.”
At the same time, Lagarde said, Asia remains home to two-thirds of the world’s poor, many of whom live in India. To address that and also make Asia’s 4.4 billion people realise their full potential, she listed six priorities: Broadening access to services like health and finance through steps like Jan Dhan Yojana; Leveraging fiscal policy impact with instruments like conditional cash transfer programs; Empowering women with access to education, dismantling barriers; Providing amenities like water, sanitation and electricity, with better infrastructure; Greater global trade integration for more sustained growth; and Tackling the challenge of climate change.
India has been working on several of these initiatives, said Lagarde, like the plan for universal access to banking services by 2018. “Through the Pradhan Mantri Jan Dhan Yojana scheme, over 210 million previously un-banked people have opened a bank account since August 2014, with social transfers paid directly,” she said, lauding the scheme. “Then with Aadhaar system, India has come up with a groundbreaking way to deliver targeted subsidies. Almost one billion people have Aadhaar numbers, and the potential to use this for delivering payments and other services — including for women — is tremendous.”
Lagarde also announced that the IMF will open a new Regional Training and Technical Assistance Center for South Asia, which will be its first fully-integrated institution and a model for future capacity development work. Indian officials said capacity development at the central and state levels in fiscal policies can enhance revenue mobilisation and help in the development of policies for more effective financial management. This is expected to help economic development and inclusive growth. It will benefit other member countries of the IMF in the region — Bangladesh, Bhutan, Maldives, Nepal, and Sri Lanka — with support from external partners like Australia and the Republic of Korea.