The Economist Intelligence Unit’s (EIU) Global Outlook report has forecast India to be the fastest growing major economy in 2024-2028, with its growth expected to outpace China’s.
The report suggests that as India's economic heft expands, there would be a crossover in the mid-2040s with BRICS nations taking over the G7 in terms of nominal gross domestic product (GDP).
The EIU has revised its forecast for real GDP growth for 2024 to 2.5 per cent compared to 2.4 per cent previously. “...growth will be unchanged rather than slowing from 2023. Growth is proving surprisingly resilient in the face of high interest rates and geopolitical risks,” the EIU Global Outlook report said.
Over the next five years, EIU has projected the global economy to grow by 2.8 per cent, with more fragmentation and regionalisation in the world economy dragging the growth potential.
“The return of industrial policy, including sanctions and the provision of new incentives, will push firms to adopt more inefficient supply chains, stoke trade tensions in strategic sectors and make it difficult to compete across the global marketplace,” the EIU report said.
The finance ministry’s monthly economic review for April said that after a strong growth which surpassed market expectations in FY24, early indications suggest a continuation of the economic momentum in the first quarter of FY25.
S&P Global Market Intelligence in its October 2023 report projected India will become the world’s third-largest economy, overtaking Germany and Japan, by 2030 on the strength of its youthful demographic profile and rapidly rising urban household incomes.
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S&P Global Ratings on Wednesday had also revised its outlook on India to positive from stable, citing robust economic expansion.
Rating agencies including Fitch and Barclays have revised India's GDP growth projection for FY24 to 7.8 per cent due to strong domestic demand and persistent growth in business and consumer confidence levels.
The International Monetary Fund in April had raised India’s GDP growth projection for FY25 by 30 basis points to 6.8 per cent in its update to the World Economic Outlook, amid buoyant domestic demand.