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S&P Global Market Intelligence in its latest issue of PMI has said that India, the world’s fifth largest economy in the world, is likely to overtake Japan to become the world’s third-largest economy with a GDP of $7.3 trillion by 2030. It said after two years of rapid economic growth in 2021 and 2022, the Indian economy has continued to show sustained strong growth during the 2023 calendar year. India’s gross domestic product (GDP) is expected to grow 6.2-6.3 per cent in the fiscal year ending in March 2024, being the fastest-growing major economy this fiscal year. Asia’s third-largest economy grew by a stellar 7.8 per cent in the April-June quarter.

It stated the near-term economic outlook is for continued rapid expansion during the remainder of 2023 and for 2024, underpinned by strong growth in domestic demand. The acceleration of foreign direct investment inflows into India over the past decade reflects the favourable long-term growth outlook for the Indian economy, helped by a youthful demographic profile and rapidly rising urban household incomes.

It mentioned ‘India’s nominal GDP measured in USD terms is forecast to rise from $3.5 trillion in 2022 to $7.3 trillion by 2030. This rapid pace of economic expansion would result in the size of the Indian GDP exceeding Japanese GDP by 2030, making India the second largest economy in the Asia-Pacific region.’ By 2022, the size of the Indian GDP had already become larger than the GDP of the UK and also France. By 2030, India’s GDP is also forecast to surpass Germany.’

Besides, it said the US at present is the world’s largest economy with a GDP of $25.5 trillion. It makes up for a quarter of the world’s GDP. China is the second largest economy with a GDP size of about $18 trillion, which is almost 17.9 per cent of the world GDP. Japan is a distant third with $4.2 trillion GDP, followed by Germany with $4 trillion GDP.