That’s what the report recently released by PriceWaterhouseCoopers (PWC) has to say – This is significant finding given that Goldman Sach’s in its earlier “BRIC report” had projected India to surpass Japan only by 2032. The PWC report pulls back by nearly 20 years, which in itself is quite huge.
The PWC report goes on to say –
India could move into third place in the individual country GDP rankings ahead of slow growing Japan as early as 2012 and seems likely to grow significantly faster than China in the decade after 2020. [source]
The reason given is actually quite obvious –
This is due both to India have a significantly younger and faster growing population than China and due to it having more ‘catch-up’ potential due to starting from a lower level of economic development than China at present.
However, India will only fully realize this potential if it continues over the next two decades to pursue the growth-friendly economic policies of the last two decades.
One of the key things that we need to consider is also that, during recession, nearly all developed countries showed flat to negative growth, Whereas countries like India and China clocked more than 6% growth.
Like the report pointed out, it is also important that Indian Economic Policies are growth oriented, which are completely dependent on how stable is the Government at the centre. If we have good pro-reformist government for most part this decade, I am quite confident that we can easily achieve close to double-digit growth through-out.
Emerging Economies Vs Developed Economies
Its not only India, but Emerging Economies E7 (China, India, Brazil, Russia, Mexico, Indonesia and Turkey) will overtake the current 7 developed economies G7 (US, Japan, Germany, UK, France, Italy and Canada).
We will see a world very different post 2020 then what we are seeing now !
India to become less dependent on Outsourcing:
India is also likely to become less dependent on outsourcing and more on manufacturing exports, building on is strong engineering skills and rising levels of education in the general population over the next decade. Consumer markets in major Indian cities will also become increasingly attractive to international companies as the size of the middle class there grows rapidly over time.
Its lucky that are part of this Era and living through this Indian rise !