India to surpass Japan as world's third-largest economy by 2030
What's the story
India is on track to surpass Japan as the world's third-largest economy by 2030 with a GDP of $7.3 trillion, reports S&P Global Market Intelligence. The nation has witnessed remarkable economic growth in 2021 and 2022, with its GDP projected to increase by 6.2-6.3% in the fiscal year ending March 2024. S&P Global said the "near-term economic outlook is for continued rapid expansion during the remainder of 2023 and for 2024, underpinned by strong growth in domestic demand."
Details
India's GDP is also predicted to overtake Germany by 2030
The surge in foreign direct investment (FDI) into India over the past decade highlights the promising long-term growth prospects for the Indian economy, supported by a young demographic and rapidly increasing urban household incomes. S&P Global noted, "India's nominal GDP measured in USD terms is forecast to rise from $3.5 trillion in 2022 to $7.3 trillion by 2030." By 2022, India's GDP had already outpaced the UK and France, and it is predicted to overtake Germany by 2030.
Cause
Digital transformation is among the key drivers of economic growth
India's sizable and rapidly expanding middle class fuels consumer spending, making the nation an increasingly attractive investment destination for multinational corporations across various sectors, such as manufacturing, infrastructure, and services. The ongoing digital revolution in India is anticipated to boost e-commerce growth, drawing top global technology and e-commerce firms to the Indian market. S&P Global revealed, "By 2030, 1.1 billion Indians will have internet access, more than doubling from the estimated 500 million internet users in 2020."
Insights
Growth prospects contribute to India's economic development
The substantial growth in FDI inflows to India in the past five years persisted even during the pandemic, during 2020-2022. S&P Global explained, "India's strong FDI inflows have been boosted by large inflows of investments from global technology MNCs such as Google and Facebook that are attracted to India's large, fast-growing domestic consumer market, as well as a strong upturn in foreign direct investment inflows from manufacturing firms."
Information
India to remain among fastest-growing economies
India is predicted to remain among the world's fastest-growing economies in the next decade, solidifying its position as a vital long-term growth market for various industries. Currently, the US is the world's largest economy with a GDP of $25.5 trillion.
Top economies
India to remain among fastest-growing economies
India is predicted to remain among the world's fastest-growing economies in the next decade, solidifying its position as a vital long-term growth market for various industries. Currently, the US is the world's largest economy with a GDP of $25.5 trillion, followed by China with a GDP of $18 trillion. Japan is at the third place with a $4.2 trillion GDP, followed by Germany with a $4 trillion GDP.