Finance Minister Arun Jaitley on Thursday said that India’ economy is expected to surpass Britain next year to become the world’s fifth largest economy.
“This year, in terms of size, we have overtaken France. Next year we are likely to overtake Britain. Therefore, we will be the fifth largest (economy),” he said.
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Other economies in the world are growing at a much slower rate, he said, adding that India has the potential to be among top three economies of the world in the next 10-20 years.
In July the World Bank had ranked India as the sixth largest economy in 2017, with a gross domestic product of $2.59 trillion, displacing France.
The Bank also said that India’s GDP will grow at a robust rate of 7.3% in 2018-19 and 7.5% for the next two years as ‘factors holding back growth in India fade’, making India the fastest growing economy among the emerging nations.
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China is expected to slow down slightly from 6.9% in 2017 to 6.5% in 2018, 6.3% in 2019 and 6.2% in 2020, it said.
The Bank’s forecast was reflected in RBI’s annual report, released on Wednesday, which said that the incoming data related to monsoon, agricultural production and industry show favourable conditions for an acceleration of activity in the Indian economy.
Keeping in view the evolving economic conditions, the real GDP growth for 2018-19 is expected to increase to 7.4 per cent from 6.7 per cent in the previous year with risks evenly balanced, it added.
“The initial lull in the progress of the south-west monsoon got reversed, including in the spatial dispersion and, in response, cropping gaps are closing. Overall, agricultural production is likely to remain strong for the third consecutive year. “Meanwhile, growth impulses in industry are strengthening, propelled by a sustained pick-up in manufacturing and mining activity, especially coal,” the RBI said.
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