As of now, the spending power of an average Indian is just 3% of that of a US citizen; however, by 2050, it will increase to 24%. This proves the fact that India is right now at the cusp of an economic boom.
As per a recent research titled “Long-term macroeconomic forecasts – Key trends to 2050” conducted by The Economist Intelligence Unit, it was revealed that by 2050, India will become world’s 3rd biggest economy overtaking UK, Germany, Japan, France and Brazil.
China will become world’s most powerful economy, beating USA.
The Current State
With an annual GDP of $2055 billion, India is right now placed at #9 rank among all the nations of the world, when it comes to the Economic ranking of the top 10 countries. With GDP of$ 17,479 billion, US is ranked #1 and China is ranked #2 with GDP of $10,335 billion.
However, taking into account the economies of 82 nations, and the long term decisions made by the Governments, there would be a major reshuffle in this ranking.
The Future
Here is the projected ranking showcased by the Economist team, based on the GDP of top 10 nations.
As we can see, besides India and China, every current top 10 nation will face severe negative growth. Infact, by 2050, Italy and Russia would be ousted from this top 10 ranking. As per various projections, Mexico, and another Asian country Indonesia would jump into the top 10 chart.
As of now, Indonesia is at 16th rank and Mexico is at 15th rank.
And India will climb 6 places to reach #3 position, behind China and USA. India will experience a growth rate of 5% in it’s GDP, which is again highest in the world.
Interesting Pointers
– Dominance of Asia: Between 2000 and 2014, several Asian economies such as Japan and Korea saw incredible growth of their GDP as in some instances, it was as high as 32%. This growth story will continue to surpass rest of the world, as India, Indonesia, Vietnam, Thailand and Malaysia would be the torch bearers of the new growth path. The report does mentions that the growth rate for the next 35 years would not that be that high, but still it account for 53% of the global GDP by 2050.
– Power of Top 3 Economies: By 2050, the combined economic power of top three countries: US, China and India would be more than the combined size of the next 5 countries: Indonesia, Germany, Japan, Brazil, and the UK.
The report mentions that as the responsibilities of the top 3 countries would become more important, especially in the cases of global warming, pollution and birth control.
You can access the full report: “Long-term macroeconomic forecasts – Key trends to 2050” here.