The State government has set a target to become a $1 trillion economy by 2025 from the current $400 million, Chief Minister Devendra Fadnavis said at the ongoing Magnetic Maharashtra Convergence 2018 global investors summit on Monday.
The existing members of the sub-nation $1 trillion club include England; Greater Tokyo; California, Texas and New York in the U.S.A.; and Jaingsu, Guangdong, Shandong in China.
Reaching there quick
Unveiling his vision for the ambitious target, Mr. Fadnavis said, “Maharashtra can be a $1 trillion economy by 2025, growing at a rate of 15.4%. Even if we grow at the current rate of 9.4%, we can still be a $1 trillion economy by 2029, but we want to achieve it four years earlier by accelerating the growth of the services sector.”
He said the services sector currently constitutes 59% to the State’s economy, while agriculture and industry sectors constitute 11% and 30%, respectively. “But we have to change this. By 2025, the services sector must grow from 59% to 67%, while the contribution of industry must come down to 27% and agriculture to 6%.”
Mr. Fadnavis said underpaid jobs in the agriculture sector should be converted into well-paid jobs in the services sector by enhancing the skills of people.
Going digital
“We have to shift to a service sector economy. We need to go for employment-led growth. The digital economy has more potential for growth and it will soon cross the material economy. There are more jobs and opportunities in the digital economy and it will help us leapfrog into a $1 trillion economy,” the Chief Minister said.
The government has created policies to promote a digital economy, he said. The focus is on creating human resources for artificial intelligence and machine learning. The State is also setting up IT- and ITES-integrated cities to promote startups and create a conducive ecosystem.
He said the State has focused on high growth sectors such as clean energy, electric vehicles, robotics, aerospace and defence technologies.
The ease of doing business in the State has been helping it attract more foreign direct investment (FDI), and Maharashtra accounted for 51% of the FDI that came to India last year, according to the Chief Minister.
The government is improving connectivity between the underdeveloped areas of the State and JNPT to boost exports and faster movement of cargo. The dedicated prosperity corridor between Mumbai and Nagpur will take the State 20 years ahead, Mr. Fadnavis said. Plans are under way to set up 25 multi-modal logistics parks in the State. The infrastructure projects outside Mumbai are geared towards removing regional disparities, Mr. Fadnavis said.
“All this will help us join the $1 trillion club. And with this, we can contribute $1 trillion to the Prime Minister’s vision to make India a $5 trillion economy,” he said.
Manufacturing potential
The Chief Minister’s preference for the service sector over manufacturing attracted criticism from Mahindra & Mahindra managing director Pawan Goenka.
“I see no reason why manufacturing will not grow more than the services sector. We should outperform [the service sector],” he said. “We must re-skill in future to ensure manufacturing growth, because the skill set required in the future will be different.” He said Maharashtra has a natural advantage for manufacturing because of the large consumption base in the State.
