Beyond the GDP Miracle: Why Corporate Investment is India’s Missing Growth Engine 

Despite India’s impressive 8.1% growth rate, economist Michael Patra identifies a critical missing link: corporate investment. He highlights a severe infrastructure deficit, with per capita spending a stark $90, and argues investment must rise from 3.5% to 6% of GDP. Further hindering growth is an underutilized workforce, where only 54% of labor is employable and women’s participation is critically low. Patra advocates for education system overhaul and safer workplaces to harness this potential. He also calls for manufacturing growth to accelerate from 5% to 8.5% and for India to increase its global export share from 1% to 5%. While ambitious, achieving this sustainable growth is possible by overcoming these internal challenges and leveraging India’s economic resilience.

Beyond the GDP Miracle: Why Corporate Investment is India’s Missing Growth Engine 

India’s economic narrative is one of global outperformance. With a stunning three-year average growth rate of 8.1%, it stands as a beacon of resilience in a volatile world. Yet, according to renowned economist and former Reserve Bank of India Deputy Governor, Michael Patra, this impressive headline number masks a critical vulnerability. The real story, he argues, isn’t just about growth—it’s about the quality and sustainability of that growth, and it hinges on one absent player: corporate investment. 

Speaking at the Elara India Dialogue 2025 in Mumbai, Dr. Patra reframed the conversation from celebrating past successes to confronting future challenges. He identified a deliberate pivot in investment strategy as the crucial lever India must pull to transition from a regional powerhouse to a true global economic leader. 

The Infrastructure Deficit: A $90 Reality Check 

While government capital expenditure has been robust, Dr. Patra highlighted a glaring gap in the nation’s infrastructure spine. His statistic was stark and revealing: India spends among the lowest per capita on physical infrastructure globally, at just $90. 

“This isn’t just about building more roads and ports,” Dr. Patra elaborated. “It’s about a fundamental upgrade. We need to raise investment from 3.5% to 6% of GDP in integrated infrastructure—roads, ports, airports, water, and logistics.” He notably expanded the traditional definition of infrastructure to include access to clean potable water and civic amenities, framing them not as social welfare but as essential economic infrastructure that boosts productivity and quality of life. 

This call to action is a direct challenge to the private sector. The government has laid the groundwork; the baton now needs to be passed to corporate India to build upon it, financing and executing projects that will define the nation’s economic landscape for decades. 

The Human Capital Paradox: An Untapped Workforce 

Perhaps the most profound insight from Dr. Patra’s address was the focus on human capital as an infrastructure project in itself. An economy cannot run on concrete and steel alone; it needs skilled, participating labor. 

He pointed to a dual crisis: first, a skills gap where only about 54% of the Indian labor force is truly employable. Second, and more critically, a gender gap where women’s participation in the labor force remains among the lowest in the world. This represents a massive, untapped reservoir of potential talent and economic energy. 

Dr. Patra’s solutions were nuanced. For the skills gap, he emphasized the non-negotiable need to “overhaul the education system” to improve the quality of employment, not just the quantity. For the gender gap, he moved beyond economic theory to a human-centric solution: “creating a safe and dignified workplace” is the primary pathway to bringing more women into the formal economy. 

The Manufacturing and Export Imperative 

The roadmap for sectoral growth was equally clear. Dr. Patra set ambitious but feasible targets: 

• Manufacturing: The sector’s value-added growth rate must accelerate from 5% to 8.5%. 

• Global Trade: India’s share of global exports needs to catapult from the current 1% to 5%. 

Achieving these goals is the tangible outcome of solving the first two challenges. Better infrastructure reduces logistics costs, making Indian manufactured goods more competitive. A better-trained and larger workforce ensures the capacity and quality to meet global demand. 

The Path to a $10 Trillion Future 

Dr. Patra’s vision is audacious: surpassing the size of the U.S. economy in purchasing power parity within two decades. He acknowledges formidable headwinds, with climate change being paramount. However, he also identified key strengths that make this ambition plausible: India’s minimal reliance on external financing for growth and its strong foreign exchange reserve position provide a stable foundation rarely seen in emerging markets. 

The conclusion is clear. India’s growth story is impressive, but it is currently running on a single engine—public investment. To reach its ultimate destination and navigate the turbulence of climate change and global uncertainty, it must fire up its second engine. The missing link isn’t potential or opportunity; it’s the decisive, large-scale capital deployment from corporate India that will build the infrastructure, empower the workforce, and manufacture the goods for the world. The foundation is poured. Now, it’s time for the private sector to build.