KV Kamath says digital economy can contribute 25% GDP by FY29

Mumbai, Noted Banker KV KamathThe current chair of the committee is. National Bank For Financing Infrastructure Development (NaBFID) expects that the digital sector will contribute 25% to the incremental GDP when the economy is a USD 7 trillion beast by FY29. CurrentlyThe contribution of the digital economy It is low at 4%, but it can reach as high as 40% in China.

The Planners and government officials see the economy as the third-largest in the world by FY29. JapanIt has a GDP of USD 7 billion, compared to the USD 3.3 trillion.

The Digital economy, which includes e-commerce, digital infrastructure and other segments of digital payments and services can be the country’s largest growth driver and contribute up to 25% to the country’s incremental GDP. India By FY29, the country will be a USD 7 trillion economy CurrentlyThis is a very low percentage of 4 percent. Kamath PTI during an interaction this weekend.

“As much as 40 per cent of the Chinese economy come from the digital sector today, and I don’t see any reason why we can’t achieve this,” The former ICICI Bank chairman quipped.

The NaBFID’s chairman, the new development finance institution that is funded by the government has no plans to stop investing in infrastructure. He says the economy is much more interested in expressways and highways as well as high-speed railheads. However, he does not think there is any reason for the government to stop making infrastructure investments.

“The economy has more appetite for infrastructure and we still have a lot to do on the key infrastructure sectors of transport such as expressways, highways, airports, seaports, and high-speed railway networks. I would say on roads, we’ve to have more and more expressways going forward, large airports and dedicated high-speed railheads for both goods as well as passengers,” Kamath said.

“More important, we can have more urban rejuvenation projects. Why to limit this to the top cities alone? Let’s build more world class cities and also upgrade the existing ones,” He stated. The To meet the growing demand for an economy with a USD7 trillion gross domestic product over the next five-years, it will need more expressways and more airports.

He It also doesn’t see the asset-quality of Banks Imploding once more, as it happened in the previous leg of the decade. Most of the infra-related companies went bankrupt due to their debt-driven expansion.

When It was pointed out that the most talked about topic is NPA Resolution — from more than 12 percent to below 5 per cent now — comes with a heavy price on banks, having written down close to Rs Since the IBC was implemented, 13 lakh crore have been raised. The recovery rate has been lower than 30% so far. Kamath Regardless of the progress made, it is still a great accomplishment. “we move forward and as the IBC system improves, there will be more incremental gains.”

On He spoke about the financing part. While banks will still be an important part of infra-finance, it is necessary to explore other sources that provide longer term funds.

The NHAI made a great start with InVits asset monetization. The He said that all infra segments, including railways should be converted to the monetization model as it is the most secure method of raising funds.

On The digital front Kamath The NaBFID is looking to finance key areas such as smart cities, data centres, and smart cities.

The NaBFID was created in 2021. Act This is Parliament With Rs Capital of over 20,000 crore, and it made the first loan with an a Rs A loan of 520 crore to the Banihal Qazigund Road Tunnel project in J&K in December. The company expects to do around Rs This fiscal will have 15,000 crore in funding.