India to 'leapfrog' Britain, France to become 5th largest economy in 2018
New York: India will "leapfrog" Britain and France to become the world's fifth largest economy in 2018, ahead of an oncoming major global economic shift towards Asia, according to a British research organisation.
The World Economic League Table (WELT) 2018 released on Monday by Centre for Economics and Business Research (CEBR) said that in dollar terms India will rise from its seventh rank to overtake those European economies next year despite the stumble of demonetisation and the introduction of Goods and Services Tax (GST).
"The World Economic League Table shows that despite temporary setbacks from demonetisation and the introduction of the new GST tax, India's economy has still catch up with that of France and the UK and in 2018 will have overtaken them both to become the world's fifth largest economy in dollar terms," said CEBR Deputy Chairman Douglas McWilliams.
The CEBR projections give India the fifth spot a year ahead of the International Monetary Fund estimates, which move it up in 2019.
According to the IMF, the size of India's economy is currently $2.439 trillion. With an annual growth rate of 6.7 per cent in 2017 and 7.4 in 2018, it expects the size of India's economy to be $2.926 trillion in 2019, when it will pull ahead of France and Britain according to its projections.
The world's largest economies now are the US ($19.362 trillion), China ($11.937 trillion), Japan ($4.884 trillion), Germany ($3.652 trillion), France ($2.575 trillion), Britain ($2.565 trillion) and India, according to the IMF.
CEBR charts a trend of global economic shift to Asia.
"The interesting trend emerging is that by 2032, five of the 10 largest economies will be in Asia, while European economies will be falling down the ranking and the US will lose its top spot," CEBR Senior Economist Oliver Kolodseike said.
According to WELT estimate, by 2032 three out of the world's four largest economies will be Asian - China, India and Japan.
Korea and Indonesia are expected to join list of the world's top 10 economies, with Taiwan, Thailand, Philippines and Pakistan making the top 25 list.
Construction activities are expected to get a tremendous boost, mainly because of India and China, according to CEBR.
"Construction's share of world GDP is to reach its highest level ever, driven by ultra large global transformational projects," Graham Robinson, director of Global Construction Perspectives, said.
"The Chinese Belt and Road Initiative and the Indian infrastructural project will boost construction's share of world GDP to 15 per cent by 2032, probably the highest share of world GDP construction has seen since the pyramids or Great Wall of China were built."