India projected to be $5-trillion economy by FY29, says Finance Minister citing IMF
New Delhi, August 4: Finance Minister Nirmala Sitharaman on Tuesday told the Rajya Sabha that India's economy is expected to cross the $5-trillion mark in the financial year 2028-29, based on projections by the International Monetary Fund (IMF). In a written reply, she cited the IMF's World Economic Outlook database (April 2026), which places India's GDP at current prices at around $5.1 trillion by 2028-29.
The Minister outlined the government's broad-based growth strategy to achieve this milestone. The approach, she said, focuses on enhancing agricultural productivity, promoting manufacturing, supporting micro, small and medium enterprises (MSMEs), expanding infrastructure, improving logistics and ease of doing business, and creating an efficient tax system through income tax and GST reforms. The strategy also includes fostering innovation and digitalisation, strengthening human capital, and ensuring energy security.
Sitharaman said these efforts are complemented by a sustained emphasis on public capital expenditure, liberalising the foreign direct investment (FDI) regime, boosting exports, and strengthening macroeconomic fundamentals through prudent fiscal management and price stability. She added that the government is also working to enhance trade resilience by expanding its network of Free Trade Agreements and Comprehensive Economic Partnership or Cooperation Agreements.
For manufacturing, the government has launched initiatives such as the Production Linked Incentive (PLI) scheme, Make in India, the National Logistics Policy, the National Single Window System, and PM GatiShakti. These are aimed at enhancing domestic production, attracting investment, generating employment, and improving competitiveness.
On MSMEs, targeted measures include enhancement of credit guarantees, the Emergency Credit Guarantee Scheme, revised MSME classification norms, strengthening the Trade Receivables Discounting System (TReDS), simplified Udyam Registration, wider access to the Government e-Marketplace (GeM), and support under the PM Vishwakarma Scheme.
The services sector is being strengthened through the development of Digital Public Infrastructure, promotion of Global Capability Centres (GCCs), Medical Value Travel and the Orange Economy. The government is also focusing on artificial intelligence and digital ecosystems, along with skill development and workforce employability.
Sitharaman noted that the Union Budget 2026-27 announced several initiatives to unlock the services sector's growth potential, including the establishment of the National Institute of Hospitality, creation of Regional Medical Hubs, expansion of Allied Health Professional institutions, development of AVGC (Animation, Visual Effects, Gaming and Comics) Content Creator Labs, and support for university townships.
In agriculture, the focus is on improving productivity through investments in irrigation, technology adoption, digital agriculture, crop diversification, post-harvest infrastructure, and better market access. The Minister also highlighted that recent Union Budgets have identified strategic sectors such as semiconductors, electronics, biopharmaceuticals, rare earths, chemicals, capital goods, clean energy, and advanced manufacturing as key growth drivers.
To prepare a future-ready workforce, the government has introduced the PM-SETU scheme, which aims to strengthen industry-aligned skilling through upgraded Industrial Training Institutes (ITIs). Collectively, these measures are expected to strengthen India's medium-term growth prospects and support the long-term vision of Viksit Bharat by 2047, Sitharaman said.
