Speaking at the platinum jubilee celebrations of the All India Management Association (AIMA), Subrahmaniam said India is “in for good times”, and the momentum is currently in the country’s favour. However, he cautioned that the key question is whether India can steer this momentum in the right direction to achieve its development goals.
According to him, India is likely to remain the world’s largest supplier of workforce over the next 25 years, making investments in human capital critical as the country works towards becoming a developed economy.
Early Investment in Children Critical
Subrahmaniam emphasised that the foundation of a strong workforce begins in early childhood. He said investments in nutrition and development in the first two years of life are crucial, warning that inadequate nutrition during this period could affect the health and productivity of future generations.
He pointed out that a child born in 2026 will be 21 years old in 2047 — the year India aims to become a developed nation — highlighting the urgency of investing in the next generation today.
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Focus on Skilling the Workforce
The policy official also called for a major push towards skill development, particularly for young people who do not pursue higher education. Nearly half of India’s youth enter the workforce directly without attending college, he noted.
He argued that skilled workers in many sectors are already earning more than engineering graduates from average institutions, underscoring the need to make vocational training both high-quality and socially respected.
India, he said, must rethink its approach to skilling and create pathways that prepare young people effectively for the job market.
Manufacturing Needs Stronger Growth
While acknowledging that India’s services sector has been performing well, Subrahmaniam said manufacturing must expand more rapidly to support long-term economic growth.
Services will continue to grow, but manufacturing needs an additional boost to drive employment and output, he said.
At the same time, he suggested India should expand its capabilities in services beyond engineering and business services to areas such as education, healthcare ecosystems, travel, and logistics, including air cargo. India, he added, has the potential to position itself as a global services hub.
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Agriculture Productivity and Regional Balance
Subrahmaniam also flagged the need to improve agricultural productivity, noting that output growth has not seen a significant jump in segments such as pulses, non-cereal crops, milk, fruits and horticulture.
He said India must look beyond the traditional focus on rice and wheat and adopt policies that encourage diversification in agriculture.
Another priority, he added, is ensuring balanced development across regions. Growth concentrated in only a few states could limit the country’s overall progress.
States Hold the Key
Much of the work required to accelerate economic growth lies with states, Subrahmaniam said, since key enablers such as electricity, land, roads and transport fall under their jurisdiction.
He urged states to identify their unique strengths and develop long-term strategies rather than replicating policies from neighbouring regions, noting that economic ecosystems differ widely across the country.
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Push for Higher FDI and Ease of Doing Business
Subrahmaniam also called for a stronger push to attract foreign investment, suggesting India should target around $200 billion in foreign direct investment.
Reducing procedural hurdles and making it easier to do business will be crucial in achieving this, he said, adding that simplifying paperwork and processes remains a key focus area.
Climate and Technology Challenges Ahead
Looking ahead, Subrahmaniam said climate change will increasingly shape economic activity worldwide, making it important for India to invest in green infrastructure, energy transition and sustainable buildings.
He also stressed the importance of strengthening research and development so that India can create globally competitive products and technologies.
“These are broad challenges, but addressing them will determine how India grows in the coming decades,” he said.
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