Prime Minister Narendra Modi wants India to become an advanced nation by 2047, exactly a hundred years after Independence. He came to power in 2014 promising double-digit economic growth in India, which is what he had achieved when he was the chief minister of Gujarat. Ironically, it was the previous government of Manmohan Singh, which over its tenure of 10 years had achieved a 10 per cent average annual growth rate.

But the Singh government dissolved into a miasma of scams and corruption. Growth in 2014, its last year in office, was only about 6 per cent. This is about the average annual growth rate that Modi has been able to achieve in his own 10 years in office. For the purposes of our analysis, the benchmark advanced country is presumed to be the United States. The United States current nominal GDP per capita (taken as an average of IMF and World Bank figures) is about $90,000.

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Because the US economy is utilized as the basis to calculate PPP (purchasing power parity, which takes into account cost of living), its PPP GDP per capita is also $90,000. It is assumed for this analysis that the US GDP per capita will stay the same, i.e. $90,000 in 2047. India’s current nominal GDP per capita is $2,500, and its PPP GDP per capita is $11,000. If India grows at its current growth rate of 6.5 per cent, then its nominal GDP per capita in 2047 will be approximately $10,000. Its PPP GDP per capita will be nearly $ 44,000. Clearly, a 6.5 per cent growth rate is not enough to catapult India into the league of an advanced nation such as the United States.

At an 8 per cent growth rate, India’s nominal GDP per capita in 2047 is about $14,000 and its PPP GDP per capita is about $60,000. Therefore, at an 8 per cent growth rate, India is getting there. At a 10 per cent growth rate, India’s nominal GDP per capita in 2047 jumps to just above $20,000 while its PPP GDP per capita balloons to approximately $90,000, catapulting it into the big leagues. One will note that even a one or two percentage point change in the growth rate has a tremendous effect on the GDP per capita (both nominal as well as PPP).

According to various reports, if India fully resumed trade with Pakistan, it could potentially add a significant amount to India’s GDP, with estimates ranging from a one to two per cent boost due to increased job creation, reduced costs, and enhanced trade potential, potentially reaching a bilateral trade volume of up to $37 billion between the two nations, according to the World Bank. The current level of trade between the two countries is $1.35 billion, which is minimal when compared to its true potential. We have in effect frozen trade ties between the two countries.

The US and Canada are today erecting trade barriers. Canadian Prime Minister Justin Trudeau has pleaded with the American people that Canadians love them. That is being economical with the truth. I have lived in Canada, and almost to a man (and woman), I have heard Canadians express their utter disdain for Americans. Yes, Canadians and Americans do not sow terror in each other’s territories, nor do they have nukes pointed at each other. India and Pakistan share a likehate (as opposed to love-hate) relationship. There is much liking for people on both sides of the border, especially in the two Punjabs, but there is intense hatred between the people as well.

We have fought wars, have nukes pointed at each other, and Pakistan instigates terror in India. Pakistan claims that India does the same in Pakistan without giving substantive proof. If India resumes trade fully with Pakistan, then it should increase its growth rate to about 8 per cent. Of course, Pakistan must ensure that there will be no more 26/11s or Pulwamas. Trade will benefit Pakistan a lot. Cost of living will go down substantially, and Pakistanis will gain access to the vast market that is India. It should also defang the hawks in Pakistan who want to destroy India. Both countries should focus purely on the bottom line. China and India are at loggerheads, yet they trade with each other. Trade has kept tensions at bay. As noted earlier, Modi has only been able to achieve a 6 per cent growth in office as prime minister.

Gujaratis are relentless entrepreneurs, focused only on the bottom line. With the right guidance from Modi, they were able to achieve double-digit growth rates. But much of the rest of India is a contented lot, believing firmly in karma. Modi should completely overhaul his government, including the politicians as well as the bureaucrats, if he wants to achieve a 10 per cent growth rate and thereby make India an advanced country. Much of the effect of the economic reforms established by Narasimha Rao and Manmohan Singh has been stunted by creeping over-regulation. Modi must ensure that he gets the best people in positions that concern the economy. If he can leave power by attaining double digit growth, his legacy in Indian history would be cemented.

(The writer is an expert on energy and contributes regularly to publications in India and overseas.)