Measuring the impact of import substitution and export promotion on India's GDP growth: an econometric analysis toward Viksit Bharat @2047

Abstract

As India approaches the centenary of its independence, the vision of Viksit Bharat@2047 requires an indigenous growth strategy. India has targeted to be a USD 30 trillion economy by 2047. This paper empirically evaluates whether export promotion and import substitution function as complementary components in the Viksit Bharat@2047 roadmap. Using annual time-series data for 1991–2025, the study applies the Johansen cointegration approach and a Vector Error Correction Model (VECM) to examine the structural and short-term relationship between real GDP, total exports, and manufacturing value added. Technological upgradation (proxied by ICT imports) is incorporated as a conditioning variable to assess transmission mechanisms. The study found manufacturing exhibits near-unit long-run elasticity with respect to GDP, highlighting its role as a structural anchor. Impulse response analysis reveals that export shocks generate persistent positive shifts in GDP. Moderation analysis further demonstrates that technological capability significantly amplifies the growth impact of exports, suggesting that technological upgrading enhances the productivity gains from global integration. These findings suggest that India’s path to Viksit Bharat@2047 is not a choice between inward industrialisation and outward orientation but a multi-dimensional architecture. The study concludes that Atmanirbhar Bharat functions as a strategy of technologically enabled global integration, where manufacturing provides stability, exports drive expansion, and technical modernisation acts as a catalytic force.