Mumbai: India is likely to regain economic momentum and could move into a current account surplus position soon, NITI Aayog Vice Chairman Ashok Kumar Lahiri said on Wednesday as global uncertainties continue to weigh on investment.
Speaking at the Global Fintech Festival 2026 here, Lahiri said India’s current account deficit (CAD) is currently below 1 per cent of gross domestic product.
“India will regain its mojo. We will generate current account surplus soon. CAD is less than 1 per cent currently,” according to him.
Lahiri said uncertainty in the global economy remains elevated amid what he described as the weaponisation of tariffs, the weakening of the multilateral trading system and rapid advances in artificial intelligence.
“The uncertainty in the global economy is palpable with weaponisation of tariffs, breakdown of the WTO system and AI technology which is disruptive,” he said.
He said that heightened uncertainty has made businesses and investors more risk-averse, but the trend is unlikely to be permanent.
“Let uncertainties recede. People have been risk averse, which is natural, but this will go,” he said.
Lahiri said attracting foreign direct investment (FDI) remains critical for India’s long-term growth strategy, not only as a source of capital but also for integration into global production networks.
“We need FDI not only for money but also for access to global value chain, for proper scale of manufacturing, for technology,” he said.
He identified manufacturing as the biggest challenge facing the Indian economy, arguing that the sector needs to expand significantly despite recent improvements.
“The major challenge is manufacturing, which has to prosper,” Lahiri said, adding that recent GDP data show manufacturing’s share in the economy has increased but “we need much more.”
India also needs to achieve greater scale in manufacturing to compete internationally, he said.
“For manufacturing we need scale, which we don’t have. China has enormous scale,” Lahiri said.
Despite the challenges, Lahiri said the Indian economy has continued to perform reasonably well and remains well positioned to benefit once global uncertainties ease.
(IANS)
