India to become largest economic superpower by end of century: CEBR

According to the most recent World Economic League Table study by the Centre for Economics and Business Research (CEBR), India will surpass China and the United States in terms of gross domestic product (GDP) and emerge as the leading economic power by the century's end.

India will overtake Japan and Germany as the world's third-largest economy by 2032, according to the analysis. The country will maintain rapid growth, averaging 6.5% from 2024 to 2028.

According to the paper, "based on demographic estimates and projections," India is projected to surpass both China and the US after 2080.

Key sources of growth are the country's big and young population, its expanding middle class, its active entrepreneurial sector, and the increasing global economic connectivity.

The report did note that India has some serious problems that require fixing, including inequality, poverty, human capital, infrastructure, and environmental sustainability.

A joint effort by public and corporate entities as well as civil society and the global community is necessary to resolve these problems, according to the CEBR research.

In 2022–23, India's GDP grew at a robust 7.2%. CEBR projects a modest slowdown in growth to 6.4% for 2023–24, leading to production that is 17.2% higher than pre-pandemic levels.

"The Reserve Bank of India's (RBI) proactive tightening of monetary policy to curb inflationary pressures and global demand moderation" were noted as other factors contributing to the slowdown.

Inflation is expected to reach approximately 5.5% in 2023, according to the CEBR analysis, even though output growth is robust, because of shocks in food and energy prices.

Government debt as a proportion of GDP is projected to reach 81.9% in 2023, up from 81% in 2022, according to the research. This poses a long-term limit on growth.

Over the next several years, India's general government debt might rise above 100% of GDP, according to a recent assessment by the International Monetary Fund (IMF).

According to the finance ministry, although the IMF study was describing "only of a worst-case scenario," it was made clear that the majority of India's general government debt is denominated in rupees, and that borrowings from bilateral and multilateral sources contribute very little to this total.

Domestic debt has a modest rollover risk and relatively little exposure to exchange rate volatility, according to the finance ministry.

According to the CEBR analysis, the government is projected to borrow 8.8 percent of GDP in 2023. Spending more on healthcare, infrastructure, and social welfare is indicative of an expansionary policy, according to the analysis.

According to the research, the forthcoming general elections in India are anticipated to determine the country's political course for the subsequent five years, making 2024 a significant year for the nation.

“The election outcomes will greatly effect India’s domestic and international policies, as well as its relations with neighbouring countries and key world powers."