Pvt investment, states key to achieving Viksit Bharat goal: EAC-PM chairman

S Mahendra Dev says sustaining growth towards Viksit Bharat 2047 hinges on private investment, cooperative federalism, and inclusive, sustainable development

Stronger private investment and active role of states are key to sustaining India’s growth momentum and taking the country towards the Viksit Bharat 2047 goal, S Mahendra Dev, the chairman of the Economic Advisory Council to the Prime Minister (EAC–PM) said on Friday.

 

To achieve the 2047 targets, Dev outlined the need for sustained real GDP growth of 7-8 per cent and an increase in the investment rate to 34-35 per cent.

 

“Private sector investment is critical. There is no problem of capital availability. Both banks and corporates are doing very well, their balance sheets are in good shape,” Dev said.

   

He was delivering the inaugural Distinguished Person Lecture organised by the Institute for Studies in Industrial Development (ISID).

 

“Viksit Bharat is not just about achieving growth. It must also be inclusive and sustainable,” Dev said, adding that India’s long-term success depends on moving towards a labour-intensive, high-growth manufacturing, and society that’s prosperous, inclusive and pro-nature.

 

Dev highlighted India’s resilience while acknowledging missed opportunities in earlier decades due to delayed reforms and inadequate focus on labour-intensive manufacturing and human development.

 

“India missed two chances since Independence -- first, by not focusing on labour-intensive manufacturing in the early decades, and second, by liberalising much later than other Asian economies,” he said, adding that despite these gaps, India has emerged as a resilient, high-growth economy.

 

Dev also pointed out that uncertainty remains a challenge for private sector investment despite improving macro indicators.

 

He emphasised that exports and investment remain the key growth drivers, while multiple government stimulus measures and monetary easing are expected to spur further private investment.

 

“Multiple stimulus measures by the government, coupled with reduction in interest rates, will lead to further private investment,” he said, noting a revival of private capex in technology sectors such as data centres, electronics, and renewables.

 

On manufacturing, Dev said that while the sector’s share in GDP might appear stagnant, its output had risen sharply, by 75 per cent between the financial year 2015 (FY15) and FY25.

 

“It’s not stagnant. Services have simply grown faster,” Dev said. He added that employment elasticity in manufacturing had turned positive after the pandemic, reflecting renewed strength.

 

Drawing attention to regional disparities, Dev called for strengthening cooperative federalism to ensure balanced development.

 

“The experience of the GST (goods and services tax) Council shows that cooperative federalism works,” he said, urging expansion of cooperative federalism beyond GST to cover development and fiscal matters to accelerate inclusive growth.

 

Dev highlighted India’s federal structure and noted that many states had announced ambitious targets for 2047, with Telangana aiming to become a $3 trillion economy.

 

“States play an important role but decentralisation stops with them, we also have to decentralise to panchayats and municipal councils,” he said.

 

Stressing the importance of inclusion, Dev described quality employment as the “most important component of inclusive growth.”

 

He underscored the need to boost women’s labour force participation and improve employability in both rural and urban areas.

 

He also urged preparation for green industrialisation, noting that climate action and net-zero transitions must involve state and district-level planning.

 

Dev highlighted new opportunities across traditional manufacturing, modern industries, and global value chains, and underscored the importance of rare earth production and technology sectors for India’s long-term competitiveness.