Daijiworld Media Network - New Delhi (SHP)
New Delhi, Dec 30: According to a recent report by a UK-based Centre for Economics and Business Research (CEBR), India is expected to overtake Germany to become the fourth-largest economy in 2026 and Japan to become third-largest in 2034.
The report also stated that India is set to reach a gross domestic product (GDP) of USD 5 trillion by 2026, 2 years later than the government’s target.
“India has decisively overtaken both France and the UK to become the world’s fifth-largest economy in 2019. It is expected to overtake Germany to become fourth-largest in 2026 and Japan to become the third-largest in 2034,” the report, titled ‘World Economic League Table 2020’, said.
Interestingly, the report claims that there would be a tough fight for the third spot between Japan, India and Germany.
Referring to Prime Minister Narendra Modi-led government’s target of taking the economy to 5 USD trillion by 2024, it said, “India is also set to reach a GDP of USD 5 trillion by 2026 — 2 years later than the current government target.” But the current economic crisis will question the sustainability of the promise.
Recently, former Reserve Bank governor C Rangarajan, said that at the current growth rate, reaching the USD 5-trillion GDP target by 2024-25 was highly unlikely.
Noting that Indian data revisions mean that 2019 was the year when the country’s economy finally overtook the UK and France, the report said, “But, slow growth during the year has increased pressure for more radical economic reforms.” Despite the rapid ascent of countries such as India and Indonesia, it is striking how little an impact this will have on the US and China’s dominant roles in the global economy, said Pablo Shah, senior economist at CEBR.
The poor GDP growth has proven to be a setback to India, which until recently was hailed as the world’s fastest-growing major economy. The growth rate saw a decline to a six-year low of 4.5 per cent in the September quarter of 2019-20.
Some of the major causes for the economic meltdown is considered to be over the slowdown in investment, financial stress among rural households and weak job creation.
The World Economic League Table is an annual calculation by CEBR jointly published by CEBR and Global Construction Perspectives. The base data for 2019 is taken from the IMF World Economic Outlook.