ZURICH: Former Reserve Bank of India Governor Raghuram Rajan stated that India could take 15 to 30 years to reach the economic size of the United States and China. He spoke at the UBS Centre for Economics in Society at the University of Zurich.
Rajan noted that many Indians are optimistic about growth prospects, expecting the current 6 percent growth rate to rise to 8 percent under favorable conditions. Despite this, he emphasized that India’s economy remains small compared to the global powers and achieving parity will require decades.
He also highlighted Germany’s commitment of over Rs 13,000 crore to India’s green economy, calling it a positive step for sustainable development.
On trade issues, Rajan addressed the 50 percent tariff imposed on India by former US President Donald Trump. He clarified that the tariff was unrelated to India purchasing Russian oil. Instead, it was linked to India-Pakistan tensions following the Pahalgam terrorist attack in May 2025.
Rajan explained that India’s Operation Sindoor, a retaliatory mission targeting terrorist sites in Pakistan, and the subsequent ceasefire were perceived differently by Washington. He noted that Pakistan managed the situation in a manner that appeared favorable to Trump, which led to a lower tariff for Pakistan at 19 percent, while India faced 50 percent. Rajan criticized claims that Trump had brokered peace, emphasizing India’s rejection of such assertions.
He concluded that India’s economic rise will depend not only on growth rates but also on strategic diplomacy and global economic engagement over the coming decades.
