India expected to become 3rd largest economy by 2031, overtaking all European nations: WEL

As India's economy picks up, the World Economic League (WEL) estimates that India will overtake all European powers to become the third-largest economy in 2031. As per the rankings released by WEL on Sunday, the world's GDP is set to hit $100 trillion in 2022. Moreover, China which is accelerating its economy is set to become the largest economy followed by the United States.

India to become 3rd largest economy: WEL

As per WEL, India has a GDP per capita of $7,314 in 2021, classifying it as a lower-middle-income country.  GDP in Q2 2020 grew by 20.1% year-on-year amid a low base and despite the deadly second wave, followed by a slightly muted figure of 8.4% in Q3 2021, marking the fourth consecutive quarter of expansion. Overall, the economy is estimated to have grown by 8.5% in 2021, with output in 2021 expected to be 0.6% above 2019 levels, stated WEL.

Lauding reforms such as the 2016 demonetisation and the decentralisation of the agricultural sector, WEL stated that it shows promise of a commitment to attaining sustainable economic growth. India is also looking enhance to its position globally, with the nation witnessing strong foreign domestic investment in 2020 and 2021, stated WEL. The report has stated that the government has recognised infrastructure bottlenecks via its National Infrastructure Plan, pushing India's ranking to leap from 7th place in 2021 to be the world’s third largest economy in 2031. WEL has warned that 'Omicron' variant threatens India’s economic recovery, inspite of India's ever-growing vaccination drive.

Other nations' rankings

The report also notes the rise of China from 2000 to 2021 from being a poor country to being an upper-middle-income economy with GDP per capita in 2021 of $18,931. "We expect the trend rate of growth for China to be 5.7% annually from 2020-25 and 4.7% annually from 2025-30 and 3.8% annually from 2030-35," says the report. WEL states that China's meteoric rise is due to its ‘dual circulation’ strategy planning for both external and domestic demand. China has curbed Western financial markets to limit the power of tech giants and to cool an overblown property market, prioritising economic stability, states WEL.

United States' share of global GDP is expected to gradually decline in the years ahead, and for the country to eventually be overtaken by China. The US is expected to expand by around 2% per annum from 2024 onwards dipping to rank 2. The 2036 rankings of India's neighbours are as follows: Pakistan - 37, Bangladesh - 24, Sri Lanka - 69. The top ten economies by 2036 are as follows - China, US, India, Germany, Japan, United Kingdom, France, Indonesia, Brazil and Russia.