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India’s emerging sectors like renewable energy and semiconductors are expected to make rapid advances on the back of the recent initiatives by the government, according to the RBI’s annual report released on Thursday. 

The interim Union Budget 2024-25, with an allocation of ?6,903 crore for semiconductor and display fabs, would contribute to making India a global hub for chip and electronics manufacturing, the report states.

Investments under the production-linked incentive (PLI) scheme are likely to gain further momentum going forward. These factors are expected to create new employment opportunities, improve labour incomes and strengthen domestic demand. Taking into account these factors, real GDP growth for 2024-25 is projected at 7.0 per cent, the report states.

The passage of ‘The Anusandhan National Research Foundation Bill, 2023’, has paved the way for establishing the Anusandhan National Research Foundation (NRF), which would provide a boost to research and innovation in basic science, healthcare, and humanities.

Furthermore, the National Quantum Mission (NQM), approved at a total cost of around ?6,000 crore (2023-24 to 2030-31), would scale up scientific and industrial research and development (R&D) and innovative ecosystem in quantum technology (QT). It would propel national priorities like Digital India, Make in India, Skill India and Stand-up India, Start-up India, Self-reliant India and Sustainable Development Goals (SDGs).

All these initiatives, along with government-led investment in the infrastructure sector and increasing adoption of digital technologies, are likely to boost productivity and potential growth in the medium term, the report states.