Home / Economy / India to overtake Japan as Asia's second largest economy by 2030: IHS
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India is likely to overtake Japan as Asia's second-largest economy by 2030 when its GDP is also projected to surpass that of Germany and the UK to rank as world's No 3, IHS Markit said in a report on Friday.

Currently, Indian economy is the sixth-largest in the world, behind the US, China, Japan, Germany and the United Kingdom.

"India's nominal GDP measured in USD terms is forecast to rise from $2.7 trillion in 2021 to $8.4 trillion by 2030," IHS Markit Ltd said. "This rapid pace of economic expansion would result in the size of Indian GDP exceeding Japanese GDP by 2030, making India the second-largest economy in the Asia-Pacific region."

On the current economic scenario, IHS Markit said, India reported the fastest pace of growth for the fifth month running in December, albeit with growth slowing in both manufacturing and services to the weakest since September, as the Delta wave rebound faded and new virus worries intensified.

"Covid-19 factors also inhibited growth in both Russia and Brazil, the former more or less stalled on the back of a third month of falling service sector activity and the latter seeing growth hold at the six-month low seen in November thanks to an ongoing manufacturing downturn," it added

Earlier, former SBI chief Rajnish Kumar said India needs to accelerate economic growth to achieve its target of becoming a $5-trillion economy by 2025. In order to ramp up economic growth, the country needs huge investment in the economy, SBI former chief said.

Meanwhile, Ratings agency ICRA has recenlty maintained its forecast of a 9% GDP expansion in FY22, with a clear K-shaped divergence amongst the formal and informal sectors of the economy. The ratings agency also expect the economy to maintain a similar 9% growth in FY23, while Wall Street Brokerage Bank of America expects India's GDP to grow at 8.2% in the next financial year, citing greater risks in the new year than the previous two years.

Indian economy has gained momentum during the July-September period, inching gradually back to normalcy as coronavirus related disruptions eased significantly in the aftermath of a devastating second wave.

GDP for the second quarter of the financial year grew by 8.4% from a year ago, one of the fastest rates among major economies, data released by the government showed on Tuesday.

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