India is projected to become the world's third-largest economy by 2030, with an estimated 7 per cent GDP growth in the fiscal year 2026-27, according to rating S&P Global Ratings released on Tuesday.
As of 2023, India is the world's fifth-largest economy, trailing the US, China, Germany and Japan. The Global Credit Outlook Report 2024 of S&P stated that India's GDP growth at the end of the current financial year is estimated to be around 6.4 per cent.
The firm estimated in its report that the GDP growth rate will remain stable at 6.4 per cent for the next financial year (2024-25), and will climb to 6.9 per cent the year after that (2025-26). The percentage will further climb to 7 in 2026-27.
"A paramount test will be whether India can become the next big global manufacturing hub, an immense opportunity. Developing a strong logistics framework will be key in transforming India from a services-dominated economy into a manufacturing-dominant one," the report said.
S&P further said the GDP growth of India will be hinged on the utilisation of its labour workforce and the involvement of women in different sectors. "Success in these two areas will enable India to realize its demographic dividend," it said.
{{/usCountry}}S&P further said the GDP growth of India will be hinged on the utilisation of its labour workforce and the involvement of women in different sectors. "Success in these two areas will enable India to realize its demographic dividend," it said.
{{/usCountry}}The significant growth recorded in the domestic digital sector of India has the potential to drive up the economy in the coming years. According to S&P, India's presence in the automotive sector "is positioned for development, leveraging infrastructure, investment, and innovation."
The United States is currently placed at the top with a GDP of $25.5 trillion, while China is in the second position with a GDP of $18 trillion. S&P has predicted that India's GDP will be at $7.3 trillion in 2030, surpassing Japan and Germany.