India at 100: India’s most decisive decades are upon us: growth, demographics and cities will make or break the dream

Three structural forces will shape India’s future over the next two decades: rapid economic expansion, the maturing of its demographic profile and accelerated urbanization. Together, they create a narrow but powerful window for reform and execution.

Economically, India’s momentum is strong. India is now the world’s fourth-largest economy with a nominal size of around $4.2 trillion, a clear marker of sustained progress. If reforms continue and investment remains robust, GDP could reach $10-12 trillion by 2036 and $14-18 trillion by 2041. By 2047, India may cross the $20 trillion mark, placing it among the world’s top three national economies.

This growth will be driven by digital public infrastructure, an expanding manufacturing base, a large domestic market and a fast-growing middle class whose consumption will reshape both domestic and global demand.

But scale alone will not be enough. As India grows larger, growth must become smarter, driven by productivity, skills and innovation rather than just an accumulation of factors of production.

Demographics offer India a second, time-bound advantage. The workforce will continue to expand through the 2030s, peaking around 2041, when India will reach its highest ever working-age share on record. This will be the moment of maximum economic potential. After that, ageing accelerates, increasing pressure on healthcare systems, pensions and public finances.

Countries that failed to convert their demographic dividend into productivity before ageing have struggled to sustain growth. India cannot afford the same mistake.

Urbanization is the third defining force. From an urban population share of about 37% in 2026, we will cross 40% by 2031 and 43% by 2036, becoming a majority-urban nation sometime in the mid-2040s. By 2047, over 800 million Indians, roughly half the country, will live in cities. These urban centres will generate more than three-quarters of GDP and almost all net job creation. Our future, economically and socially, will be decided by what happens in Indian cities and how they fare.

Third, we must shift decisively from technology adoption to leadership. Long-term competitiveness will depend on innovation capacity. R&D spending should rise to around 2% of GDP by 2040. Innovation districts linking universities, startups and industry clusters can accelerate tech commercialization.

India’s success with digital public infrastructure should be extended into areas such as healthcare, logistics, education and clean energy. Openness to global talent and research collaboration will be critical.

Fourth, India must strengthen its industrial and export base. Manufacturing should grow not just in scale but in sophistication. Policies should promote advanced manufacturing, automation and supply-chain integration. Export-oriented sectors, electronics, pharmaceuticals, renewable technologies, agri-processing and digital services can each become trillion-dollar opportunities over time.

Regulatory stability, contract enforcement and simpler taxation are essential to attract sustained investment.

Fifth, India must prepare early for an ageing society. The demographic shift after 2041 will be rapid. A multi-pillar pension system covering both formal and informal workers is essential. Healthcare infrastructure must expand, especially in geriatric care. Insurance penetration should deepen and technology-enabled eldercare solutions must be encouraged. Policies enabling longer, healthier working lives can soften the economic impact of ageing.

Sixth, climate and resource resilience must be treated as core economic priorities, not add-ons. Water scarcity, extreme heat and climate volatility threaten productivity and urban liveability. India must accelerate renewable energy and green hydrogen development, apart from energy storage. Water governance reforms, covering groundwater, river basins and urban usage, are urgent. Industrial policy should favour low-carbon and circular economy models from the outset.

Execution will be the hardest test. India needs institutions that think beyond electoral cycles. Rolling five-year transformation plans aligned with demographic milestones would help sustain momentum. Data-driven governance, integrating labour, health, education, urban and climate data, will be essential for timely course correction.

The next 20 years will determine not just India’s economic rank, but the quality of life of its citizens for generations. The demographic dividend is finite. Urbanization is irreversible. Climate pressures are intensifying. Yet, the opportunity is historic.

India being a developed country at 100 is not guaranteed, but it is achievable. The choices made now will determine whether we will enter our second century of independence as a prosperous, resilient and globally influential nation or as one that took too long to fulfil its own potential.

The author is managing director and chief executive officer of People Research on India’s Consumer Economy.