According to the latest calculations by Bloomberg, India has become the world’s fifth-largest economy after it overtook the United Kingdom in end-March 2022. This news came at a time when PM Modi, during his 2022 Independence Day speech, had urged the countrymen to resolve to become a developed country by 2047.
Key highlights of the report –
- India is now fifth largest economy in the world —
- India has overtaken the UK to become the world’s fifth-largest economy. It is set to become the third largest by 2029.
- Size of Indian economy —
- On an adjusted basis and using the dollar exchange rate on the last day of the relevant quarter, the size of the Indian economy in nominal cash terms in the quarter through March was $854.7 billion.
- On the same basis, UK was $816 billion.
Comparison between India and the U.K. –
- Population —
- This is one of the most fundamental differences between the two countries.
- As of 2022, India has a population of 1.41 billion while the UK’s population is 68.5 million. In other words, India’s population is 20 times that of the UK’s.
- GDP per capita — Since there is such a stark difference between the population of the two countries, GDP per capita of India is much lower.
- Poverty levels —
- At the start of the 19th century, the UK’s share in extreme poverty was considerably higher than India’s.
- However, as things stand today, the relative positions have reversed even though India has made giant strides in curbing poverty.
- Human Development Index —
- On this front, experts believe India might still take a decade to be where the UK was in 1980.
- Performance of UK in HDI 2019 – 0.932 (score), very high category (HDI tier)
- India’s performance in HDI 2019 – 0.645 (score), medium category (HDI tier).
- Universal Healthcare Coverage — While faster economic growth and the government’s policy focus on healthcare schemes since 2005 have made a distinct improvement for India, there is still a long way to go.
SBI Report on India’s economy –
- India had surpassed UK as the fifth-largest economy as early as December 2021, according to a State Bank of India report, published earlier.
- The report says that the share of India’s GDP in global GDP is now at 3.5%, as against 2.6% in 2014 and is likely to cross 4% in 2027.
- Key highlights of the report —
- The report said that the path taken by India since 2014 reveals it is likely to get the tag of third-largest economy in 2029.
- India should surpass Germany in 2027 and most likely Japan by 2029 at the current rate of growth.
- The Indian economy is forecast to grow by 7-7.5% in the current fiscal year while the UK economy has been battling a sharp slide in growth and record high inflation.
- Latest data showed the Indian economy grew by 13.5% in the quarter ended June.
- The IMF has forecast India to grow by 7.4%. The IMF forecast has shown India will retain its tag as the fastest growing major economy in the world.