As stated in the reports of US-based think tank World Population Review India, from its previous autarkic policies, it is developing into an open-market economy.
“India’s economy is the fifth-largest in the world with a GDP of USD 2.94 trillion, overtaking the UK and France in 2019 to take the fifth spot,” it said.
The size of UK economy and France economy is USD 2.83 trillion and USD 2.71 trillion respectively.
Further mentioned in the report was, India’s GDP in terms of Purchasing Power Parity (PPP) is USD 10.51 trillion that is more than Japan and Germany. Due to increasing population, India’s GDP per capita is USD 2,170 (as compared to the US is USD 62.794). However, India’s real GDP growth is expected to weaken for the third consecutive year from 7.5% to 5%.
Indian economic liberalization began in the early 1990s that includes industrial deregulation, reduced control on foreign trade and investment, and privatisation of state-owned enterprises.
“These measures have helped India accelerate economic growth,” it said.
“India’s service sector is the fast-growing sector in the world accounting for 60% of the economy and 28% of employment, it added that manufacturing and agriculture are two other significant sectors of the economy,” the report said.
Prime Minister Narendra Modi led government is all set to take the economy to USD 5 trillion by 2024.
“India has decisively overtaken both France and the UK to become the world’s fifth-largest economy in 2019. It is expected to overtake Germany to become fourth largest in 2026 and Japan to become the third largest in 2034,” the report, titled ‘World Economic League Table 2020’, said.
Still there are many questions arising on the maintainability of the target.
“According to current growth rate, reaching the USD 5 trillion GDP target by 2024-2025 is “simply out of question,” former Reserve Bank governor C. Rangarajan said.
India has seen decline in growth rate to a six year low of 4.5 per cent during the September quarter of 2019-2020, which was said to be world’s fastest growing economy.