India will be 90 percent of US economy by 2050: PWC

March 7th, 2008 - 8:08 pm ICT by admin  

New Delhi, March 7 (IANS) The $1-trillion Indian economy would be 90 percent the size of the US by 2025, as the nation of 1.17 billion people, rather than China, tops the global growth league today, says PricewaterhouseCoopers (PWC). But investors also need to look beyond Brazil, Russia, India and China, the so-called BRIC nations, for growth opportunities, according to the consultancy’s report entitled “The World in 2050: Beyond BRICs”.

“The global centre for economic gravity is already shifting to China, India and other large emerging economies and our analysis suggests that this process has a lot further to run,” said John Hawksworth, head of macroeconomics for PWC.

“But the fastest mover could be Vietnam, with a potential growth rate of almost 10 percent per annum in real dollar terms that could push it up to around 70 percent of the size of the UK economy by 2050,” he said.

“China could overtake the US around 2025 to become the world’s largest economy and will continue to grow to around 130 percent of the size of the US by 2050. India could grow to almost 90 percent of the size of the US by 2050,” he said.

“In the long term, perhaps India, too, may displace China gradually, if it can create the right political and economic preconditions for manufacturing investment,” the report added.

As per the report, India rather than China, tops the growth league table, which is a reflection of the country’s working age population that is projected by UN to continue to grow at a healthy rate unlike China’s.

The fact is that there is greater scope for productivity and education levels to rise across the Indian population, enabling the country to catch up with members of the Organisation of Economic Cooperation and Development, it said.

“Retailers need to be savvy enough to identify the right business strategies and local partners for such overseas ventures,” said Hawksworth.

“This has not always been the case for overseas investments by retailers in the past, particularly in culturally unfamiliar territories such as China or India.”

“Similar cautions apply to other potential winners, such as business services, energy and utilities, healthcare, educational services, media companies and owners of leading global brands,” the report said.

As highlighted in a previous research, mitigating upward pressure on energy consumption and carbon emissions was one of the most important challenges posed by rapid growth of the emerging economies, it added.

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