India Faces Gigantic Challenges But Shows Remarkable Strength, Says Former ECB Chief Jean-Claude Trichet

In an exclusive interview with CNBC-TV18, Jean-Claude Trichet lauded India’s ability to withstand external shocks, including US tariffs, and maintain rapid economic growth.

He described India’s challenges as ‘gigantic’ but emphasised that its strengths, particularly its skilled workforce and innovation capacity, offer considerable advantages in a volatile global environment.

Trichet noted that India faces enormous challenges, particularly in job creation and sustaining structural reforms.

“India has enormous challenges, as underlined by the central bank governor and the finance minister. They have a lot of jobs to create. The challenges are really gigantic,” he said, highlighting the critical need to balance rapid growth with social and economic inclusion.

Despite these challenges, Trichet praised India’s consistent GDP expansion.

He highlighted that analysts have recently revised India’s growth projections upward to 6.8% for FY26, positioning the country as one of the fastest-growing major economies despite global headwinds such as tariffs, inflation, and geopolitical conflicts.

Strength in Human Capital

Trichet emphasised India’s ‘remarkable’ human capital, particularly its engineers and professionals, noting that European companies have expressed high satisfaction with Indian talent.

He highlighted India’s strong tradition in mathematics, science, and technology education, which provides a robust foundation for long-term growth and innovation.

Addressing India’s vision to become a developed economy by 2047, Trichet struck a cautiously optimistic tone.

“India should not be complacent. It’s a very ambitious goal and calls for very ambitious reforms. But I am reasonably confident,” he said.

He stressed that maintaining policy continuity and implementing structural reforms are essential to meet these objectives while creating employment opportunities for its young population.

Trichet also reflected on broader economic uncertainties, warning that US tariff policies could negatively affect growth globally.

He praised the Reserve Bank of India’s flexible inflation-targeting framework as a success in stabilising the economy but emphasised the ongoing need for policy stability to maintain investor confidence.

In conclusion, Trichet’s assessment underscores that India’s combination of resilience, skilled human capital, and commitment to reform positions it to navigate global economic challenges successfully.

Strategic reforms and sustained investment in human resources, he suggests, will be key to transforming India into a major developed economy by 2047.

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