Key Highlights:
- Bhalla says US pressure is pushing India to reform and grow.
- India has potential to grow at 8.5% with better productivity.
- Defence spending seen as key to both security and economic strength.
New Delhi: India's economy could grow much faster if a trade deal with the United States is signed, says top economist Dr Surjit Bhalla. He believes such a deal can help India reach its full potential.
Bhalla is a former Executive Director at the International Monetary Fund (IMF). He gave an exclusive interview to IANS, where he said the deal under negotiation could lift India's growth rate to around 7.5 percent or even 8.5 percent.
He noted that India is already growing at 6.5 percent, which is fast compared to other large economies. However, he believes India can do even better.
US Pressure Helping India Reform
Dr Bhalla said that pressure from the US government is not a threat. Instead, it is helping India carry out much-needed reforms. He especially pointed to past deadlines and tariffs set by former US President Donald Trump.
“I don’t see them as threats,” Bhalla said. “In fact, the US and even Trump are doing us a favour by pushing us to reform.”
Indian and American negotiators are working to finish an interim trade deal before a July 9 deadline. This is to avoid US tariffs on Indian goods. A report in the Financial Times said the deal could be completed this week.
A Path to a Bigger Deal
The upcoming trade deal could also open the door to a full free trade agreement between India and the US by the end of the year. Experts believe this would bring long-term benefits to both economies.
Bhalla praised India for becoming the world’s fourth-largest economy and for being the fastest-growing major economy. But he said that real success means growing closer to full potential, not just looking at GDP numbers.
Defence Spending Is Good for Growth
The economist also spoke in support of India’s defence efforts, including the recent Operation Sindhu Sudarshan.
“Defence is a core national priority,” he said. “More defence spending leads to more security and strengthens the economy.”
He believes strong national security gives people and businesses more confidence, which helps the economy grow.
(With IANS Inputs)
