Per capita income to hit $4,000 by 2030, says SBI report

India's economy is on a steady path to a major milestone and is to achieve a per capita income of $4,000 in the year 2030, IANS citing SBI Research report issued on Monday.

Upper-middle income status within reach

This level of per capita income would enable India to be classified as an upper-middle-income country, thus putting it in the same group as China and Indonesia according to the current worldwide income classification.

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The country took almost 60 years after the independence to become a $1 trillion economy. But the moment this milestone was reached, the growth rate increased tremendously. In just 7 years from there, the county reached t the $2 trillion by 2014.

Then it was able to exceed the $3 trillion mark by 2021, again taking only 7 years. Most importantly, the country managed to be a part of the $4 trillion economies in 2025, making it only 4 years for the next trillion dollars.

India could hit $5 trillion in next two years

Dr Soumya Kanti Ghosh, Group Chief Economic Advisor at State Bank of India, said that the growth path is to continue, IANS reported.

He said that India might be a $5 trillion economy in two years which would further enhance its position in the global economic hierarchy.

In 2009, India reached a per capita income of $1,000, then $2,000 in 2019. It is expected to reach $3,000 by 2026 and if the trend continues, $4,000 by 2030.

India among fastest-growing global economies

In the last ten years, India has moved up from the 92nd percentile to the 95th percentile of the global average real GDP growth distribution.

The report gives a glimpse into the future and the long-term ambition of India to be a high-income country by 2047 as per the government’s Viksit Bharat vision.

The current globally defined high-income country category corresponds thus to a per capita Gross National Income (GNI) of $13,936.

To get to this level in 2047, India would have to keep its per capita GNI growth rate at about 7.5 per cent a year.

Higher growth needed if income thresholds rise

If, the high-income limit rises to $18,000 then India would not only have to rely on its 8.9 per cent annual rate of growth to become a high-income country by 2047, but also on the consistent application of reforms, better productivity, and concentrated investment in the key areas.

After taking into account population growth and inflation considerations, SBI Research approximates that India will have to ensure a nominal GDP growth in dollar terms of around 11.5 per cent per year for the next 23 years.

To sum up, SBI Research sees India as a country that will soon step into the upper-middle income category by 2030.

The government will be able to prove, due to its givens, that India is a part of the 'high-income economies' by 2047, which will be a major turning point in its development path, as it will have also conquered the global economic frontiers through the decisive policy support, strong economic fundamentals, and a growing global role.

With inputs from agencies.