The gulf between states.

"What's growth likely to be in 2022-23 and what's the trajectory of growth from 2023-24? For both, I think, the range is between 6.5% and 7%,closer to the upper end of the band for the first question and closer to the lower end of the band for the second question," opined Chairman of the Economic Advisory Council to the Prime Minister of India Bibek Debroy. However, like the song "Anything you can do, I can do better", wikipedia, "Economic Advisory Council member Sanjeev Sanyal...said India is capable of sustaining an economic growth of 9 percent for many years." ET. India's nominal GDP was around $3.20 trillion in 2021. World Bank. At a compound annual growth rate (CAGR) of 9% our nominal GDP should reach $7.6 trillion. investor.gov. At present India is fifth behind the US, China, Japan and Germany, worldometers, but, given that Japan and Germany have much lower growth rates India would become the third largest economy in the world. Sounds fantastic, but, divided by our huge population, it will make only a slight difference to the standard of living of ordinary people. India's per capita GDP was just $2,277 was 2021. World Bank. So when can India's per capita GDP match those of rich countries? Economist Augusto Lopez-Claros explained that in Europe in 1990, the income per capita of the 3 poorest states was about 50% of that of the 3 richest states. But the poorer states grew much faster and have largely caught up because of 'fiscal federalism'. However, "India has a state like Kerala which has an income per capita in PPP terms of over USD 9,000 which is higher than Ukraine was before the war. And then the country has Bihar, which is again on PPP terms approximately USD 2000 and practically, accounts to one-fifth of that of Kerala." TN. "An all-India growth rate is a function of what states achieve and factor market reforms are largely contingent on what states do. A large chunk of public expenditure, including capital expenditure, is made by the states," wrote Debroy. "A middle-income status by 2047 is certain." But surely, we are already there. According to the new classification, countries with per capita gross national income (GNI) of $1,046 - $4,095 are lower middle-class, from $4,096 - $12,695 are upper middle-class. World Bank. In 2021, India's per capita GNI was $2,170, which is almost double that of the lower limit. World Bank. The problem is that the gap between richer and poorer states in India is getting wider. The goods and services tax (GST) was supposed to narrow that gap by transferring tax collection from rich manufacturing states like Maharashtra and Gujarat to poorer consumption states like Bihar. wikipedia. But, "As it turns out, more industrialized states such as Maharashtra and Gujarat also have a high consumption base comprised of a relatively more affluent population, and are thus able to 'capture' the tax within their state borders." howindialives.com. As a result, "over half of of the proposed industrial investment - including capacity expansions - are still accounted for by just three, relatively industrialized states: Gujarat, Maharashtra and Karnataka." India's GDP is not evenly distributed. The gulf between states is increasing.