The India story economic story has just gotten bigger! A recent report by Knight Frank claims that India will pip China and emerge as the largest economy in the world. The research report expects India to grow at a phenomenal rate of 8 per cent between 2010 and 2050.
- No 1: India Since 1991, when economic liberalization unshackled India from the slow rate of growth and threw its doors open to the global economy, India has never looked back. The Knight Frank report assumes that India will shake off its current crop of social, political and economic issues and go on to the top of the heap.
- No 2: China It should come as no surprise that China is second in this list of the biggest GDPs by 2050. The country’s growth in the past two decades has been nothing short of a miracle. Having already gone past Japan as the world’s second largest economy it is threatening the position of the US as the world’s preeminent economy and will overtake it in 2020. But eventually growth will be slower than India who will overtake it by 2050.
- No 3: US The current economic superpower will continue to be in the top three in terms of GDP. But at a less that $40 trillion it will be half that of China, which will be at $80 trillion. For all its woes, the US will remain an important economic superpower due to its insatiable domestic consumption, innovation capabilities and technological prowess.
- No 4: Indonesia One of the fastest growing economies in the world, Indonesia will emerge as the world’s fourth largest economy by 2050. Its inclusion may come as a surprise, but the main reason is the country’s large natural resources reserves and being an emerging economy it has huge potential for growth. The current government has encouraged private investment: both private and foreign to boost economic growth. This trajectory will continue with the economy growing at 6.8 per cent on an average till 2050.
- No 5: Brazil Currently part of the BRICS brigade, Brazil will complete the top five economies of the world by 2050. Brazil overtook the UK as the world’s sixth largest economy in March, 2012 and it will not slow down over the next few decades. Blessed with an abundance of natural wealth, it also has thriving agriculture, manufacturing and services industries. Brazil will continue to grow slower than China and India but still be a giant economic force to reckon with.
- No 6: Nigeria For years now Nigeria has been a poster child for Africa through its steady and impressive economic growth by maintaining political and social stability. The country is heavily reliant on the oil industry, which accounts for 80 per cent of the country’s GDP, but it has been trying to increase the share of agriculture and trading. Nigeria will overtake South Africa as the continent’s leading economy by 2025 and stay there come 2050.
- No 7: Russia Once a superpower and the only counterweight to the US, Russia has bounced back with steady economic growth in the last decade. All of which has been fueled by excess of natural resources like gas, oil, coal, and precious metals. Political and social instability remains, but the economy shows no signs of a slowdown.
- No 8: Mexico The country may have serious issues with poverty, social stability and income inequality but it is still a big economic force whose economy runs in the trillions of dollars. Over the past two decades, Mexico has improved its macro-economic fundamentals leading to stable economic growth, low inflation and improved per capita income. Currently it is on a huge drive to improve its infrastructure, which is key to its manufacturing industries that account for the lion’s share of the GDP.
- No 9: Egypt The country shed its highly centralized economy sometime in 2000 and moved towards a market-oriented economy. Several fiscal reforms were put in place leading to an increase in foreign investment and an average GDP growth of 5 per cent. At present there seems to be a policy paralysis as the interim military appointed interim government and the democratically elected Muslim Brotherhood fight for power. The IMF is stalling of giving it a much-needed loan because it wants broad political consensus on economic reforms that have been promised. While agriculture is important, its manufacturing and services contribute to the bulk of the GDP.
- No 10: Japan The land of the rising sun, continue its decline from the second largest economy in the world at the turn of the century to ninth biggest by 2050. After the lost decade in the 1990s, Japan continues to experience slow growth and deflation. The country is currently recovering from the twin disasters of the earthquake and tsunami, which devastated the economy. Even as economic growth slows, it will continue to be an important location for high-tech manufacturing, automobile and electronic industries.
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