India accelerates its path to becoming a major power.

According to credit rating agency S&P Global, India is the world's fifth-largest economy and could surpass Germany and Japan to become the world's third-largest economy by 2030. Previously, due to issues such as a lack of investment capital and land acquisition, India's infrastructure remained underdeveloped and presented numerous challenges in construction. Indian Prime Minister Narendra Modi has prioritized infrastructure development, particularly railways and roads, as a key government priority. Many important airports are also seeing the construction of new terminals.

Ambition to become the world's factory.

Recently, India has welcomed corporations like Apple, Samsung, and Airbus in an effort to become the world's factory. Apple is one of the leading names opening up opportunities for India to become the world's factory. Apple accelerated production and began manufacturing its latest phone models there, starting with the iPhone 14, then the iPhone 15. Currently, about 12-14% of Apple's phones sold worldwide are manufactured in India, and this is expected to increase to 25% by the end of this year.

India's Minister of Commerce and Industry, Piyush Goyal, hopes Apple's example will send a strong signal to global companies. The country's smartphone exports doubled in the fiscal year ending March 2023, reaching $11 billion.

India is becoming an important manufacturing location for Apple.

A decade ago, Prime Minister Modi's government outlined a long-term ambition to transform this South Asian nation into the world's new manufacturing hub. " I want to appeal to the whole world: Come manufacture in India ," Modi emphasized.

To realize this, India launched the “Make in India” initiative to boost its manufacturing sector, which currently accounts for only 17% of GDP. This strategy includes increasing import tariffs to encourage domestic production. High economic growth (7.3%) and the world's largest population of 1.4 billion people are also advantages that help the South Asian nation attract corporations looking to access this booming market.

India recorded $71 billion in FDI in the 2022-2023 fiscal year, with $33 billion in the first half alone. At the World Economic Forum (WEF) in Davos in early 2024, Information Technology Minister Ashwini Vaishnaw stated that the country aims to attract $100 billion in foreign direct investment annually in the coming period.

To achieve this, India improved four key drivers: infrastructure (physical and digital), raising the living standards of the lowest income earners, boosting manufacturing, and simplifying bureaucratic processes.

Through a multifaceted approach, the Indian government aims to become an economic powerhouse. However, PS Suryanarayana, a senior researcher at the S. Rajaratnam Institute of International Studies (RSIS) at Nanyang Technological University (Singapore), argues that India is unlikely to quickly become the world's factory. Currently, India is primarily focused on building a modern manufacturing base. To achieve this goal, India is also seeking to cooperate with foreign countries.

Visiting Professor Chilamkuri Raja Mohan of the Institute of Southeast Asian Studies (ISAS) at the National University of Singapore also noted that India still has a very long way to go to become the world's factory. Manufacturing has always been a weakness of the Indian economy.

During his first term (2014-2019), Prime Minister Modi sought to turn the tide by implementing the "Made in India" initiative. In his second term (2019-2024), Modi continued to promote incentives and support for several manufacturing sectors, including the semiconductor industry. He achieved considerable success in the mobile phone sector and hoped for similar success in laptop and computer manufacturing. International investment in India's manufacturing sector did indeed grow significantly during this period.

Seize the demographic dividend and harness the potential of the younger generation.

According to the global economic rankings by the Centre for Economic and Business Research (CEBR) in the UK, by 2038, the economies of South Korea and two populous powers, India and Brazil, will be in the top 10.

S&P Global data also shows that East Asia and Southeast Asia will become the engine of global growth. India will boost Asian economic growth in the coming years, with GDP growth projected to reach 6.4% in 2024 and 7% in 2026.

India has replaced China as the world's most populous country. However, UNICEF warns that half of the youth in South Asian countries lack the necessary skills when they leave school and are unable to find stable employment.

In fact, like China, India's birth rate is also declining, but the country has what statisticians call demographic dynamics, namely a young population. Furthermore, India currently has a large number of women of childbearing age, so the population is expected to continue growing until the middle of this century. A large young population can accelerate India's economic growth, giving it a chance to join the ranks of economic superpowers.

According to Xinhua News Agency, a 2023 report by online legal services provider Vakilsearch stated: “ If India wants to fully leverage the post-transition global economic model, while providing a diversified supply chain and creating a market that businesses can rely on, implementing certain tax incentives that can bring trade benefits, helping businesses achieve long-term benefits from transactions in India, then the skills-for-job mismatch among young people needs to change .”

Source: https://congthuong.vn/an-do-tang-toc-de-tro-thanh-cuong-quoc-307641.html