India has emerged as the third-largest economy in the world, ahead of Japan, based on purchasing power, says a new report on the issue by the World Bank released on Tuesday.
The US continues to top the table, followed by China and India, in a count that is done every six years by measuring economies on the basis of their purchasing power parity (PPP).
PPP is price-relative, according to the report, which show the ratio of prices in national currencies of the same good or services in different economies.
For example, if the price of a hamburger in France is 4.80 euros and in the US it is $4.00, the PPP for hamburgers between the two economies is $0.83 to the euro from the French perspective (4.00/4.80) and 1.20 euro to the dollar from the US perspective (4.80/4.00).
The report is compiled by the World Bank under the International Comparison Programme (ICP), a worldwide statistical initiative considered the largest in geographical scope.
ICP 2011, as this round is being called, covered 199 countries.
{{/usCountry}}ICP 2011, as this round is being called, covered 199 countries.
{{/usCountry}}India was ranked 10th largest economy in the 2005 survey, and is at the third position in 2011.
The US controls 17.1% of the world's gross domestic product (GDP) based on PPP measure, followed by China (14.9%) and India (6.4%), leaving Japan far behind at 4.8%.
But India continues to rank poorly in terms of per-capita GDP — 127th compared to the US at 12, Japan at 33 and China at 99.
The six largest middle-income economies — China, India, Russia, Brazil, Indonesia and Mexico — account for 32.3% of world GDP, whereas the six largest high-income economies of US, Japan, Germany, France, UK and Italy account for 32.9%.