New Delhi:

Condolence messages from economists mourning the death of former Prime Minister Manmohan Singh poured in on Friday, with IMF Deputy Director Gita Gopinath stating that the economic reforms he ushered in as finance minister in 1991 had inspired countless young economists like her.

“Dr. Manmohan Singh’s 1991 budget unshackled India’s economy, significantly enhancing the economic prospects for hundreds of millions of Indians. His visionary reforms inspired countless young economists like me. Rest in peace, Dr. Manmohan Singh,” Gita Gopinath said on X.

Sanjeev Sanyal, member of the Economic Advisory Council to the Prime Minister (EAC-PM), said that his generation of Indians was the creation of the economic reforms introduced by Finance Minister Manmohan Singh and Prime Minister Rao in 1991.

“As I have said before, the two most significant years of the twentieth century for India were 1947 and 1991 — one brought political freedom and the other economic freedom. Manmohan Singh will always be remembered for announcing the Great Liberalisation…” Sanyal said.

Condolence messages also came in from industrialists for the former Prime Minister and former finance minister who had played a key role in opening up the Indian economy and breaking away from the erstwhile licence-permit raj that had shackled industry.

JSW Group chairman and MD, Sajjan Jindal, said; “Saddened by the passing of Dr. Manmohan Singh ji, former Prime Minister of India and the visionary leader behind India’s economic liberalisation. A statesman of humility and wisdom-India owes him a debt of gratitude.”

The US-India Business Council expressed deep condolences following the passing of Dr Singh, highlighting his significant contributions to strengthening the relationship between the United States and India.

USIBC praised Dr Singh for his pivotal role in in the 2008 Civil Nuclear Agreement between the two countries and economic reforms that shaped modern bilateral ties.

(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)

Gita Gopinath, the first Deputy Managing Director of the International Monetary Fund (IMF), was back at her college hangout spot in Delhi yesterday. Posting a picture on X, formerly twitter, Gita Gopinath shared that she used to spend hours at the JP tea stall at Delhi School of Economics. 

Ms Gopinath was accompanied by director of the Delhi School of Economics Prof Ram Singh at the tea stall. 

“A walk down memory lane: Hanging out at the JP tea stall at my alma mater Delhi School of Economics @UnivofDelhi. Spent many hours at the tea stall back in the day. Thank you Prof. Ram Singh (Director of DSE) for inviting me back!” she captioned the post. 

A walk down memory lane: Hanging out at the JP tea stall at my alma mater Delhi School of Economics @UnivofDelhi. Spent many hours at the tea stall back in the day. Thank you Prof. Ram Singh (Director of DSE) for inviting me back! pic.twitter.com/vScp909L9l

— Gita Gopinath (@GitaGopinath) August 17, 2024

Ms Gopinath was in the national capital to attend Delhi School of Economics’ 75th anniversary celebrations. There, she interacted with the students and had a conversation with NK Singh, Chairman of 15th Finance Commission of India. She shared a glimpse of the event on X. 

Enjoyed my fireside chat with ⁦@NKSingh_MP⁩ and interacting with students at the Delhi School of Economics ⁦@UnivofDelhi⁩ as part of the 75th anniversary celebrations. pic.twitter.com/QRUDbfUol0

— Gita Gopinath (@GitaGopinath) August 17, 2024

Ms Gopinath did her masters from Delhi School of Economics of the University of Delhi after doing her bachelors from Lady Shri Ram College of the same university. She then earned another master’s degree from the University of Washington before doing her PhD from Princeton University. 

While in India, Ms Gopinath met Finance Minister Nirmala Sitharaman and congratulated her on the policy continuity in the fiscal consolidation path followed by the Government of India.

The First Deputy Managing Director @IMFNews, Ms. @GitaGopinath, called on the Union Finance Minister Smt. @nsitharaman, in New Delhi, today.

Ms. @GitaGopinath congratulated the Union Finance Minister on the policy continuity in the fiscal consolidation path followed by the… pic.twitter.com/T40ys37u9o

— Ministry of Finance (@FinMinIndia) August 17, 2024

Ms Gopinath also had a wide-range discussion with NDTV, in which she said that India will need a multi-pronged approach to create jobs instead of targeting only a few areas to add more workers.

“India has done extremely well in headline growth numbers… It is the fastest-growing major economy in the world. If you look at the last decade, growth has averaged around 6.6 per cent. Certainly India’s growth has been much more capital intensive, but much less in hiring a lot more workers, in creating a lot more jobs,” Ms Gopinath told NDTV.

She also spoke about climate change and how it is impacting the Indian economy and what India needs to do to become a developed nation by 2047. 
 

Union Finance Minister Nirmala Sitharaman with Deputy Managing Director of the International Monetary Fund Gita Gopinath, during a meeting, in New Delhi, on August 17, 2024.
| Photo Credit: PTI

India has been a laggard among G20 nations in terms of employment generation and the country needs to create an additional 148 million jobs by 2030 given the population growth, IMF’s First Deputy Managing Director Gita Gopinath said on Saturday (August 17, 2024).

India on an average grew at 6.6% for the decade starting 2010 but the employment rate was under 2%, she said at the Delhi School of Economics Diamond Jubilee event here.

So, India’s employment rate is much less when compared to other G20 nations, she said.

“If you look at India’s projections in terms of population growth, India will have to create anywhere between 60 million to 148 million additional jobs cumulatively between now and 2030… we are already in 2024, so in a short period of time we have to create a lot of jobs,” she said.

Given the scale of what is needed, it is going to require basic reforms including land reforms and implementation of labour codes.

To generate more jobs, she said, there is a need for an increase in private investment as it is not commensurate with 7% growth in GDP.

However, she said, public investment is going well but private investment has to improve.

She also said that India should revamp its education system so that it can improve the skill set of its workforce.

Besides, she said, there is a need to further ease of doing business, improve the regulatory environment and broaden the tax base.

‘India will need more reforms to stay on growth path’

India will need to undertake more reforms to be able to continue on the path of raising economic growth and to make sure that enough job creation happens in the country, Ms. Gopinath said.

Ms. Gopinath further said that India will be required to reduce import tariffs if it wants to be an important player in the global supply chains.

“The significant improvements have been made by the government over the years in terms structural reforms.” While noting that the world is in an environment where trade integration has been questioned, Gopinath said it is important for India to remain open for global trade.

“Tariff rates in India are higher than in its other peer economies. If it wants to be an important player on the world stage and an important part of global supply chains, it is going to require reducing those tariffs,” the eminent economist said.

Gopinath said it is a tremendous aspiration to get to a developed country status but it does not happen automatically, and requires ongoing, consistent efforts, pretty broad scale, across many areas to deliver on that.

“India has grown well in terms of its overall growth rate, and at 7%, it is the fastest growing major economy in the world.

“The question is, how does one keep up the momentum and raise it further so that you can increase per capita incomes in India to get to being an advanced economy,” she said.

Responding to a question on taxation, she said India has parallels with other developing countries, where most of the tax revenue that is collected is indirect taxes and not direct taxes, not in form of income taxes.

“We have been advising other developing countries too, that it is helpful to broaden the personal income tax base and so that you can have more income coming from there,” she said.

Referring to the cut in corporate tax rate by the Modi government, Ms. Gopinath said although it was helpful it is less the tax rate that matters, but what matters is just making sure that there are no loopholes and there are not too many leakages that happen in terms of tax exemptions.

“It is very important to have sufficient progressivity in your tax system…making sure that you are (India) getting enough from your capital gains tax from your capital income tax is going to be critical,” she said.

Gopinath also suggested that now there is better technology to implement property tax and this is again another area where work is needed.

New Delhi:

India will need a multi-pronged approach to create jobs instead of targeting only a few areas to add more workers, the International Monetary Fund (IMF) First Deputy Managing Director Gita Gopinath told NDTV today.

She said at least in India, any disruption caused by artificial intelligence (AI) in the jobs sector will have a lower impact as a majority of India’s workforce is in labour-intensive agriculture.

“India has done extremely well in headline growth numbers… It is the fastest-growing major economy in the world. If you look at the last decade, growth has averaged around 6.6 per cent. Certainly India’s growth has been much more capital intensive, but much less in hiring a lot more workers, in creating a lot more jobs,” Ms Gopinath told NDTV.

She gave a small list of to-dos in order to create more jobs in India.

“In the near-term, it is helpful to improve the ease of doing business. We see that in Gujarat and Tamil Nadu. Removing trade restrictions also plays a very important role. Public infrastructure investment is already happening, and more of that will absolutely help,” the key IMF officer said.

“But to make this a medium-long term growth story requires more investment in human capital and scaling up the workforce. You look at India’s workforce in terms of the number of years of education. It is much lower compared to its peers. So investing in raising the skill level of the country is going to be absolutely critical,” Ms Gopinath said.

She said creating jobs has to be a multi-pronged approach. “The numbers are large. It cannot be done by targeting a few areas. It’s going to require broad-based job creation,” she said.

On concerns over AI derailing India’s plans and policies to increase the number of jobs, the Indian-origin IMF officer said only 10 per cent of India’s workforce is at risk of displacement by AI.

“Since a majority of India’s workforce is in labour-intensive agriculture, the impact of AI is going to be lower. We assume 24 per cent (of India’s workforce) is exposed to AI, of which 10 per cent is at risk of displacement. This is a small number. The question is what are we going to see around the world?” Ms Gopinath said.

At the IMF, Mr Gopinath oversees the work of staff, represents the fund at multilateral forums, maintains high-level contacts with member governments and board members, the media, and other institutions, and leads the IMF’s work on surveillance and related policies, and oversees research and flagship publications.

She previously served as the Chief Economist of the IMF from 2019-22. In that role, she was the Economic Counsellor of the IMF and Director of its Research Department.

New Delhi:

Gita Gopinath of the International Monetary Fund (IMF) has called for more investments in health and public infrastructure in India and a workforce that’s way more skilled.

Ms Gopinath, First Deputy Managing Director at IMF and professor at Harvard University, pointed out what India needs to do to become a developed nation while speaking at Delhi School of Economics.

“India is the fastest growing economy among the major economies. The question is how to keep up the momentum in the long run,” she said at DSE’s Diamond Jubilee Conference.

The top IMF economist said that India needs a workforce that’s “much more skilled and much more educated”. This is absolutely critical to take India towards a high-income economy, she added.

She also called for more investments in public infrastructure – in which she said there’s a gap – and institutional measures to support high growth in the long run. Ease of Doing Business, efficiency of the judicial system and land Reforms are absolutely critical.

Flexibility in labour markets, which includes the implementation of labour codes, keeping trade open, and more investments in health are also

She also called for an increase in women’s labour force participation.

Earlier in the day, she told NDTV that climate change posed a downward risk to the Indian economic outlook and called for “a lot of action” by the country.

She said while India has done “extremely well” in terms of headline growth, the employment growth here has been lower than 2%.

“India’s growth has been capital intensive, but hiring workers has been much less. India needs more investment in human capital and skilling workers. Jobs between 60-148 million need to be created between now and 2030,” she told NDTV.

New Delhi:

After Prime Minister Narendra Modi, during his Independence Day address to the nation, said the country is on its way to become the third-largest economy with big reforms across sectors, Gita Gopinath, Deputy Managing Director of the International Monetary Fund (IMF), has stated that the country is likely to achieve this feat by 2027.

India has become the fifth-largest economy in the world, and is set to be among the top three global economic powers soon.

According to Ms Gopinath, India’s growth did much better than expected during the last fiscal year (FY24) as private consumption growth recovered across sectors, especially in the rural economy.

From two-wheeler sales to fast-moving consumer goods (FMCGs), the overall consumption is surging. “With better monsoons come better harvests and agricultural incomes go up,” she was quoted as saying in media reports.

According to latest data by the Society of Indian Automobile Manufacturers (SIAM), the total production of passenger vehicles, three-wheelers, two-wheelers and quadricycle reached 24,37,138 units in July. Two-wheeler segment posted a decent growth of 12.5 per cent in July compared to the same month last year.

On the other hand, the FMCG market in India remains resilient despite challenges. According to marketing research firm Kantar Worldpanel, the FMCG sector is expected to register 6.1 per cent yearly growth in FY 2024-25 in the rural market, which was 4.4 per cent last year.

According to the report, volumes in rural market could equal those in the urban market, which is higher at present. The rural FMCG market is more valuable to the industry than before and is generating almost half the volume and value for the sector.

Ms Gopinath also mentioned that the country needs to create millions of additional jobs in the next 5-6 years.

The IMF has raised its economic growth forecast for the country for FY25 to 7 per cent from 6.8 per cent projected in April. According to RBI Governor Shaktikanta Das, if the average growth India recorded over the three years is seen, the average comes to 8.3 per cent. In the current year, they have given a projection of 7.2 per cent growth.
 

(This story has not been edited by NDTV staff and is auto-generated from a syndicated feed.)

Marrakech:

As the lingering effects of the Covid pandemic and the Russia-Ukraine war continue to be felt, it’s been a challenging few years for the global economy, but there are rays of hope as well. In an exclusive interview with NDTV in Marrakech, the International Monetary Fund’s Gita Gopinath spoke about the macroeconomic stability in India, the headwinds in China, artificial intelligence, extreme weather events and how all of these will impact the trajectory of the world economy in the coming years.

Speaking on the sidelines of the 2023 World Bank Group – IMF Annual Meetings, the First Deputy Managing Director of the IMF also spoke about the impact of the conflicts between Israel and Gaza and Russia and Ukraine on oil prices and food security. 

Boundless Potential, Some Concerns

Emphasising that it is early days to assess the true potential of artificial intelligence, Ms Gopinath said the promise of generative AI could raise productivity and help boost slowing global growth. 

“But it is far from certain at this point whether we are going to get all that productivity gain. Obviously, the innovation is important but it is going to require regulation. This is not business as usual, this is a very different animal that we have to deal with in terms of regulation. We have to make sure AI is used so that it actually benefits humanity,” she said. 

Ms Gopinath said governments will need plans and account for the possibility of a lot of workers being affected directly by AI, and some losing their jobs. 

“What we have seen traditionally with technology is this concern that it will cause a lot of layoffs and doesn’t really help create jobs. And what history has taught us is that, on net, a lot more jobs are created. They are in different sectors and demand different skills and so there are people who get affected and lose jobs but that’s where policy plays a role in making sure that they get the right support they need,” she said.

The senior IMF official also said that AI will have an impact on the general pay structure. “It is very interesting, the early studies that are coming up. In the past, as a new entrant to a particular industry, you didn’t have the experience, you had to wait to learn and therefore the pay you got was not as much. With AI you get to use the experience that others had and you get that information really quickly. So we could see somewhat more of a flattening of the pay structure. “

India Third-Largest Economy?

Asked about India’s economic growth and whether the country is on course to becoming the third-largest economy in the world by 2030, Ms Gopinath said, “India has strong growth. At 6.3%, it is one of the largest growth numbers that we have among major economies. We have 6.3% for this year and 6.3% for next year. We did the upgrade because the first quarter data came in somewhat stronger than we had expected.”

“If there is this continuing amount of public investment that happens, that seems to be catalsying private investment and consumption is holding up better than we expected, so I think those are good signs. In terms of the trillion-dollar number that India gets to, I am always a bit cautious because in the last three years we had the pandemic and Russia’s invasion of Ukraine. I wouldn’t want to venture into talking about particular dates,” she added.

Mr Gopinath pointed out that the important thing is that India’s economy is strong, there is macro stability and inflation is coming into the RBI’s target band. “The financial sector is the strongest it has been in a long time. If you combine that with structural reforms, a lot of which is still needed, that could generate a lot of growth in India,” she said.

China Concerns

Ms Gopinath said the IMF had downgraded China’s growth projection slightly, from 5.2% to 5% for this year, and the organisation sees growth slowing down in China in the coming years. She emphasised that the property sector is an important concern and so are its ageing population and weaker productivity growth.

“In terms of spillovers to Asia as a whole, the estimate we have is that when China’s growth goes down by 1 percentage point, it shaves off about 0.3 percentage points out of growth over a five-year period for Asian regions. If I look at India specifically, I don’t see strong direct spillovers. We don’t expect to have a big effect of India slowing down. But if there is a more general slowdown in the global economy that comes from Asia slowing down, of course that would feed into growth for India,” she said. 

World Growth, Food Insecurity

Asked about the reasons behind the global growth outlook for 2023 being 3%, well below the pre-pandemic levels, Ms Gopinath pointed to ageing demographics and weakening productivity. She said China plays an important role in this. 

On food insecurity stemming from the Russia-Ukraine conflict, she said it affects low-income countries the most because they spend a big percentage of their consumption basket on food. She asserted that while food prices have come down, they are still quite high and that remains a concern. 

Ms Gopinath said that among the measures taken by the IMF to address this was the creation of the Food Shock Window to help countries in need. 

Climate And The Future

Ms Gopinath said that while there is an increase in extreme climate-related disasters and the economic cost of that is adding up, the implications for global growth are small for now because the larger economies are doing relatively okay.

“For individual countries, small island nations, this can be very, very big. Even in India, temperatures are going up at twice the rate that it’s happening, on average, in the world. So it is quite vulnerable,” she said.

The IMF official pointed out that India played a big role in pushing for the reforms of Multilateral Development Banks through its G20 leadership and she sees momentum on that front. She also said the inclusion of the African Union into the G20 is very important because most of the working-age population will be on the African continent over the next many years.