India will need to double its credit growth to 15 percent to become a $5 trillion economy by the financial year 2024-25, say bankers.
They further said that it is achievable as the country has recorded high double-digit credit growth in the past.
"If you want to reach a $5 trillion economy, the outstanding credit, which is around Rs 95-98 trillion, it will have to be doubled, which means we need to grow (credit) at around 15 percent," said State Bank of India's Chairman Rajnish Kumar at an IBA event.
Union Bank of India's Managing Director and CEO Rajkiran Rai G also agreed that for a $5 trillion economy, credit growth has to be more than 15 percent per annum.
"To sustain that kind of credit growth, we need to build a robust risk management system so that we don't repeat the mistakes of past. The sourcing, process, monitoring have to be evolved and technology will play a major role in it," Rai said.
Currently, the credit growth of banks in India has been hovering at around 7 percent.
Kumar said India also needs a huge amount of investments in the infrastructure sector.
However, he said globally the norms around capital are getting tighter, which restricts capital for growth.
He said that to enhance its project financing capabilities, SBI has done a lot of policy modification. The Indian Banks' Association (IBA) is also working on resolving issues surrounding consortium lending, he added.
On Thursday, Prime Minister Narendra Modi underlined the need for working together to make India a $5 trillion economy, while stressing that the government has been able to maintain macroeconomic stability amid a tough global environment.
"Let's move ahead with the resolve to make India a $5 trillion economy," he said in reply to a debate on Motion of Thanks to President for his address to Parliament.