India’s economy will surpass Japan, Germany by 2030, reveal forecasts

The fastgrowing young population is perceived to boost economic activity

NEW DELHI: India is well poised to become the third-largest economy by 2030, surpassing four developed nations — Japan, Germany, Britain and France — according to projections by international agencies.

The estimate by the United States Department for Agriculture Economic Research Service (USDA), based on data collated by World Bank and IMF, assumes the Indian economy will expand annually at an average 7.4% to $6.84 trillion by 2030. This will make it bigger than the economies of Japan ($6.37 trillion) and Germany ($4.38 trillion).

What’s more, India’s annual economic output will be almost double that of Britain ($3.6 trillion) and France ($3.44 trillion) in the next 15 years.

International Monetary Fund’s (IMF) managing director Christine Lagarde, who has repeatedly coined India as a “bright spot”, has forecast that the country will surpass Germany by 2030.

India’s fast-growing young population is perceived to boost economic activity and help the nation outpace ageing developed nations.

Rising aspirations in the world’s second most populous country are driving demand for mobile phones, electronic goods, cars and houses.

The government’s apex think tank, Niti Aayog, on Sunday projected the Indian economy would grow by an annual average rate of 8% in the next 15 years.

“The future looks extremely bright... There is a very good case that we should, over the next 15-16 years, grow at 8%,” Niti Aayog’s vice-chairman Arvind Panagariya has said.

After 15-16 years, India’s gross domestic product or size of the economy will touch ₹469 lakh crore from ₹137 lakh crore in 2015-16, he said, reeling out numbers in terms of local currency.

The US will continue to be the global leader with an annual economic output, measured in terms of gross domestic product, of $24.8 trillion in 2030.

But it is estimated to grow by an average annual 2.1% from $16.97 trillion in 2016, as per the USDA data. China will close in the gap with the US by growing its GDP by 5.3% to $19.2 trillion by 2030, from $9.4 trillion in 2016.

Last month, management consultant PricewaterhouseCoopers (PwC) portrayed India to emerge as a super-power ranked only after the United States and China.