India could be the fastest growing economy in the world in the next 10 years as the mass of economic activity shifts from the US and Europe to Asia, entrusting greater responsibility on India in the new global economic world order, former UK Prime Minister Gordon Brown said on Saturday.
“The Indian economy will double in size in the next seven years, certainly by 2020,” Brown told delegates at the HT Leadership Summit.
India’s gross domestic product (GDP) is set to grow by 8.5% in 2010-11, and a 10% growth rate was achievable in the near term, Brown said, speaking on Lessons from the Last Global Crisis.
“Your (India’s) role at G-20 is absolutely critical. India is right at the centre of the discussions,” Brown said. “It is in India’s interest that the world economy grows fast.”
India has a crucial role to play in driving investment, trade and consumption to push growth in the world economy. “It is a global story. I don’t believe the economic crisis is over.” Europe and the US are not in a position to grow at the pace for keeping unemployment low and raise prosperity.
On the bank credit crisis that pushed the world economy into the worst recession in 80 years, Brown said global leaders may have erred in gauging the magnitude of the problem. “We assumed that the risks the banks were taking were well diversified,” Brown said.
He said it won’t be “honest” to talk about free market access while adopting protectionist measures. “America needs to double its exports to get out of the crisis.”
The former British Prime Minister said there was ample scope for consumption-driven growth in India. The US and Europe together account for about 20% per cent of the world’s consumption while China accounts for about 3%. India’s share in the world consumption is less than 1%. Thus, India has a long way to go in expanding consumption.