Madhya Pradesh is aiming to spearhead India's growth narrative, with Chief Minister Mohan Yadav outlining ambitious plans to transform the state into a model of development by 2047. Speaking at the Economic Times World Leaders Forum (ET WLF) on Friday, August 22, 2025, Yadav highlighted Madhya Pradesh's strategic advantages and ongoing reforms designed to attract investment and spur economic expansion.
Strategic Advantages and Reforms
Yadav emphasized that Madhya Pradesh possesses surplus resources, including electricity, land, and water, coupled with strong connectivity, making it an attractive investment destination. The state government has introduced 18 policies focused on easing business operations and expediting approvals for new industries. Approvals have been streamlined, reducing the number of permissions required to establish an industry from 29 to just 10. To attract significant investments, projects exceeding ₹500 crore receive direct approval, along with electricity rebates and other incentives.
The Chief Minister underscored the state government's commitment to expanding its budget by 15-16% annually to fuel growth. For the current financial year, Madhya Pradesh's budget stands at ₹4.2 lakh crore, approximately 15% higher than the ₹3.65 lakh crore for FY25. Furthermore, the state incentivizes employment generation by offering ₹5,000 as a one-time viability gap funding (VGF) for every laborer employed by an industry.
Economic Growth and Development
Madhya Pradesh has demonstrated significant economic progress in recent years. The state's Gross Domestic Product (GDP) grew by 6.05% to ₹7.1 lakh crore in FY25, up from ₹6.7 lakh crore in FY24. The state's labor force participation rate increased to 72.7% in 2023-24 from 67.8% in the previous year.
The Confederation of Indian Industry (CII) projects that Madhya Pradesh has the potential to become a $2.1 trillion economy by 2047-48, a substantial increase from its current size of $164.7 billion. To achieve this ambitious goal, the state aims to increase its contribution to India's economy from the current 4.6% to 6% over the next 22 years. The state cabinet has discussed a vision document, 'Developed Madhya Pradesh @2047', which aims to increase the GSDP from the current ₹15.03 lakh crore to ₹250 lakh crore by 2047. Simultaneously, efforts are underway to boost the state's per capita income from ₹1.60 lakh to ₹22 lakh.
Sectoral Focus
While agriculture currently contributes 43% to Madhya Pradesh's economy, the state recognizes the need for a strategic shift towards enhancing the manufacturing sector to sustain long-term growth. The goal is to increase the share of manufacturing from 7.2% to 22.2% by 2047. To support this, the state government has declared 2025 as the "Year of Industry". Madhya Pradesh's economy is significantly agrarian but is making rapid strides in the industrial and service sectors. Indore, Bhopal, and Jabalpur are the top three districts in terms of highest output generation in the state's economy.
The state is focusing on several key areas to achieve its economic objectives:
By implementing these reforms and leveraging its strategic advantages, Madhya Pradesh aims to become a major contributor to India's economic growth and achieve its "Viksit Bharat 2047" goal.
