India is poised to surpass the United States and emerge as the world’s second-largest economy behind populous neighbour China on purchasing power parity basis by 2050, said a latest report published by consulting firm PricewaterhouseCoopers (PwC).
“India, helped by its strong demographic dividend, is poised to overtake the US to emerge as the second largest economy in purchasing power parity terms by 2050”, said Jairaj Purandare, regional managing partner and leader (markets and industries), PwC India, in the report titled The World in 2050.
India’s trend growth is expected to overtake China’s trend growth at some point during the coming decade due to India having a significantly younger and faster growing working age population than China. Also, India is having more potential for growth as it is starting from a lower level of economic development than China and so has more catch-up potential.
India has the potential to be the fastest growing large economy in the world over the period to 2050, with a GDP at the end of this period to be close to 83% of that of the US at market exchange rates (MER), or 14% larger than the US in terms of purchasing power parities.
“The global financial crisis has further accelerated the shift in economic power to the emerging economies,” the report said.
However, India will only fully realise this great potential if it continues to pursue the growth-friendly economic policies of the last two decade