To become a middle-income country ($12,000 GDP per capita) from its current low-income status ($1,800 per capita), India must sustain 7-8% growth for the next three decades. Very few countries have achieved such a sustained period of high growth.What should be India’s economic development model to achieve this ambitious objective? The answer seems obvious. All large countries have followed the twin strategies of (1) manufacturing growth and jobs, and (2) merchandise exports which typically added 1-2% to GDP growth.We differ from this consensus and believe that India must proceed on a different development journey, which accounts for different global circumstances and leverages India’s strengths. Our hypothesis is that digital technologies will power mass services just like industrial technologies powered mass manufacturing.Digital technologies are powerful because they can dramatically reduce the cost of providing sophisticated services to consumers, transforming existing industries and creating new business models; just like industrial technologies did for product manufacturing and consumption in the 20th century.For example, Uber which has deployed a new business model using its own digital platform to drive down cost per km to its customers now employs more people and has a higher valuation than all rental car companies put together. It has become the fastest globalising company ever, present today in 77 countries in just seven years.Globally, this economic shift is visible in the stagnation of merchandise trade (in fact it is falling between developed and developing countries). At the same time services trade, in particular digital services, is growing rapidly. This global shift is driven not just by the growth in anti-trade measures for manufactured goods, but changed economics of manufacturing from the adoption of technologies collectively called Industry 4.0 which is leading to a shift from globally integrated supply chains to more localised manufacturing, and has led to decline in total manufacturing employment in the world.Digital technologies are impacting economies and industries/ services and creating massive opportunities for growth and jobs. In many traditional manufacturing industries the growth of digitally savvy customers on the one hand and Internet of Things (IoT) on the other is driving ‘servitisation’ of products which is growing faster than product, but more importantly creating more new jobs than are being eliminated on the shop floor.A global example is digital platform Predix launched by GE for hosting applications for asset performance management by allowing industrial assets to be connected digitally, allowing collection and analysis of huge amount of data to deliver real-time insights to optimise performance. This allows industrial companies to sell products as a service by the hour or output, from jet engines to sophisticated MRI machines. A local example is Tringo launched by the Mahindra Group as the ‘Uber’ for tractor market, which lowers the cost per hour of hiring a tractor for a farmer which in turn can expand the market hugely over time.But the big opportunity for growth and jobs is in the power to transform services in two very distinct ways. First, the rapid growth of digital trading platforms like Alibaba, Amazon and Flipkart is giving rise to new forms of enterprises and supply chains. For example, Alibaba.com has launched trade facilitation services in India as a one-stop platform for all trade-related transactions for SMEs. Such a platform allows even small artisan producers to sell to any buyer worldwide and is transforming global supply chains in the same manner that the invention of shipping containers did in the 1950s, triggering off the boom in global merchandise trade.Second, digital technologies can dramatically lower the cost of service delivery on one hand (for example, processing an e-loan by one-third to one-fifth of a traditional process) and the cost of customer acquisition on the other. Once a digital service is launched via the cloud the marginal cost of servicing a new customer is virtually zero, and thus can potentially expand the market in an unlimited manner very quickly, as shown, in a different context by PokemonGo which was downloaded by hundreds of millions of customers within weeks and months of its release and added $9 billion to the market cap of its founder.India is uniquely advantaged in scalable digital technologies. In financial services, India is building a unique, first-of-its-kind digital stack (known as the “India Stack”) with Aadhaar, Jan Dhan accounts and various payment technologies such as UPI and the Aadhaar Payment Bridge System. This scalable platform offers an opportunity to develop innovative services not just for the Indian customer but can easily be modified to offer similar services to global customers.India’s aviation sector is growing faster than in any other large country and will soon be the world’s third largest. Airline fares in India are among the lowest in the world driven by airline business models that leverage all-digital operations and sophisticated sale-leaseback strategies. Developing and deploying these ‘technology stacks’ across well-penetrated service sectors like construction, under-penetrated sectors like health or nascent sectors like urban management services can deliver not just economic growth but millions of new jobs.India will hopefully be the first large economy, which will transition from low income to middle income in the digital 21st century.(Jayant Sinha is Minister of State for Civil Aviation. Arindam Bhattacharya is Senior Partner and Director, BCG Henderson Institute. Views are personal.)