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Published: December 6, 2023
Updated: December 6, 2023

India's Economic Ascent: S&P Global Predicts Third-Largest Economy by 2030

In a promising forecast, S&P Global predicts that India is poised to become the third-largest economy by 2030, backed by a projected GDP growth from 6.4% in 2023 to 7% in 2026. This revelation positions India as the fastest-growing major economy in the next three years, according to the report released on Tuesday.

Growth Projections:

The report anticipates a growth rate of 6.4% for India in the fiscal year 2023-24, slightly down from the 7.2% recorded in the preceding financial year. Looking ahead, it foresees a persistent growth rate of 6.4% in 2024-25, a subsequent increase to 6.9% in the following year, culminating in a noteworthy 7% growth by 2026-27.

Manufacturing Hub Challenge:

While India is positioned to be the fastest-growing emerging market globally, the report emphasises a critical challenge—whether India can successfully transition into the next major global manufacturing hub. The need for a robust logistics framework is highlighted as pivotal for transforming India's economic landscape from services-dominated to manufacturing-centric.

Labour Market Empowerment:

S&P underscores the importance of enhancing skills and increasing female participation in the workforce to unleash the potential of India's labour market. Success in these areas is deemed crucial for India to leverage its demographic dividend effectively.

Digital Market Potential:

The report acknowledges India's thriving domestic digital market as a catalyst for the high- potential startup ecosystem, particularly in financial and consumer technology. This signals an optimistic outlook for India's economic evolution over the next decade.

Forecast aligns with current GDP growth rate:

S&P's perspective aligns with India's recent GDP growth of 7.6% for the September quarter, reflecting resilience and potential. As India navigates the path towards economic prominence, addressing challenges and leveraging demographic strengths will be key. The forecasted trajectory positions India as a global economic force, emphasizing the need for strategic investments and comprehensive reforms to realize its full potential.