India's economy is likely to grow by an average of between 8 and 9% a year for the next 20 years, Montek Singh Ahluwalia, deputy chairman of the Planning Commission said, dismissing concerns about the current slowdown.
Burdened by high interest rates and a fragile global economy, India's GDP grew less than 7% in the July-September quarter, the weakest pace in more than two years.
"I think there is a very good chance that in next 20 years you will see the Indian economy grow somewhere between 8-9% per year," Ahluwalia said on Friday in a speech at a university in Bhubaneshwar.
Ahluwalia did not elaborate on the reasons for his optimism, but repeated the oft-taken line of Indian policymakers that global economic power was increasingly shifting to developing countries in Asia.
"There are many predictions that say by the year 2030-2033 the largest GDP in the world will be China, second largest would be United States and third largest will be India," he said.
Ahluwalia also said India's population of about 1.2 billion was expected to grow by an average of only 1% a year over the next 20 years, which would help increase per-capita incomes.
"So if the economic growth (is) between 8 and 9% and population growth is only at one%, then per capita income in the next 20 years - there is very good chance it will grow some where between 7 and 8% per year," he said.
While many economists believe that target is achievable, they say much will depend on the pace of reforms the government undertakes in the coming years.
"There is no reason why India can't grow at that rate but it depends on the political environment over a 20-year period, as well as the kind of reforms across the board that different shades of government can undertake in this period," said N. Bhanumurthy, senior economist at the National Institute of Public Finance and Policy, a New Delhi policy think-tank.
The government of Prime Minister Manmohan Singh has achieved little in the way economic reforms over the past two years, contributing to a near 16% fall in the value of the rupee and a near 25% fall in the the main stock index in 2011.
