Per capita income could go up to ₹14.9 lakh by 2047

August 16, 2023
Posted by: OptimizeIAS Team
Category: DPN Topics

Per capita income could go up to ₹14.9 lakh by 2047

Subject :Economy

Section: National Income

Context: India’s per capita income is set to increase 7.5 times to ₹14.9 lakh, or about $12,400, per annum by FY47 from ₹2 lakh ($2,500) in FY23

Key Points:

Per capita income is expected to increase from ₹2 lakh in FY23 to ₹14.9 lakh in FY47 (in USD terms, the corresponding increase comes to about $12,400 in FY47 from about $2,500 in FY23), per the estimates by SBI’s economic research department (ERD) , published in its economic research report “Ecowrap”.
Weighted mean income of Income Tax Return (ITR) filers increased to ₹13 lakh in the Assessment Year (AY) 2023 from ₹4.4 lakh in AY2014, and could further jump to ₹49.7 lakh in 2047 with shifting of distribution of tax-filers from lower income group to upper income group.
Income Tax Return (ITR) numbers:
- The tax filer base could reach 48.2 crore IT filers in FY47 (from about 7 crore in FY23), increasing its share in taxable workforce/workforce eligible to pay taxes to 85.3 per cent from current 22.4 per cent.
- State wise ITR filed during AY23 shows that Maharashtra, Uttar Pradesh, Gujarat, Rajasthan and West Bengal are the top 5 States. These States constitute about 48% of the total income tax returns filed in AY23
Other growth projections:
- India is likely to become the third largest economy by 2027. The Indian economy is currently ranked fifth and is behind the US, China, Japan, and Germany.
- India’s real GDP will need to grow at 7.6% annually over the next 25 years to achieve the per capita income level to become a developed economy. India’s per capita income is currently estimated at $2,500, while it must be more than $21,664 by 2047, as per World Bank standards, to be classified as a high-income country.

Per capita income

Per capita income, also known as income per capita, is a key economic indicator that measures the average income earned by each individual in a specific geographical area, such as a country or a region.
It is calculated by dividing the total income of the area by its population. Per capita income provides valuable insights into the overall economic well-being of a population and serves as a comparative tool to assess the relative prosperity or standard of living among different regions or countries.
Per capita income is used to gauge the distribution of wealth and economic development. Higher per capita income generally indicates a higher level of economic prosperity, better access to goods and services, and potentially improved quality of life for the population.
However, it’s important to note that per capita income alone might not provide a complete picture of economic conditions, as it doesn’t account for income inequality, cost of living variations, or distribution of wealth within a population.