India must ramp up manufacturing, FDI and AI-ready jobs to achieve developed status, says CEA
Chief Economic Adviser Nageswaran urged India to boost manufacturing, attract foreign investment and create AI-compatible jobs to sustain growth and become a developed nation.
At the 13th SBI Banking & Economics Conclave 2026, Chief Economic Adviser Nageswaran outlined India’s path to developed-nation status amid global geopolitical strain, supply-chain risks and rising Chinese manufacturing competition. He stressed that economic resilience requires simultaneous expansion of manufacturing and services, supported by state and national policies that simplify taxes, protect investors and develop skilled labour.
Strengthening foreign direct investment and securing supply chains were identified as priority actions. Regarding artificial intelligence, Nageswaran cited research showing mixed effects on employment and warned that limited entry-level job growth could exacerbate inequality, especially given India’s demographic dividend. He advocated for a dual focus on AI-driven and AI-resistant jobs in sectors such as hospitality, tourism and elder care, and urged greater private involvement in vocational curriculum design. Despite these challenges, he noted that India’s economy continues to grow at 7.8%, driven by digital infrastructure, financial inclusion and capital spending.
Why it matters
The remarks set out the policy mix India needs to sustain growth and reduce inequality as it aims for developed-country status.
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