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Former Reserve Bank of India (RBI) governor D. Subba Rao has welcomed the current political debate over the issue of providing freebies to the people.

He was speaking on India @75 - Marching Towards $5 Trillion Economy on the occasion of 75 years of Indian Independence held at FTCCI on Monday.

"Good that Prime Minister Narendra Modi triggered a debate on state subsidies. All political parties are at fault for the situation. The states and Union government must realise that, we do not have surplus budgets and while some safety net is surely needed, they must be cautious and selective on what freebies to be given from borrowed monies and the future generations should not be burdened with unnecessary debt burden," he cautioned.

The former RBI chief opined that India can emerge a 5 trillion economy only by 2028-29.

"India can become a 5 trillion economy as envisaged by Prime Minister Narendra Modi not before 2028-29. Also, for this, we need to clock an annual GDP growth of 9 per cent consistently for the next 5 years," Subba Rao said.

He listed eight challenges in the journey to achieving a 5 trillion dollar economy.

"These include increasing investment; improving productivity; improving education and health outcomes; creating jobs; raising agriculture productivity; maintaining macroeconomic stability; managing global mega trends and improving governance," Subba Rao elaborated.

Noting that while India has made strides in all spheres of lives in the last 75 years, Rao pointed out that 200 million Indians are still under the poverty line which is a huge concern.

He stressed on the need to take along 600 million people in all the development activities. With 12 million youth entering the job market every year, its only manufacturing sector which can provide jobs of that scale and not the Agriculture, or services sector, he opined.

On the occasion, FTCCI has released a booklet of compilation of industrial growth strategy over the last 7.5 decades on the occasion of 75 years of independence.