Business
The figure highlights four structural changes that will take place in the next forty years
Updated : Feb 03, 2020, 07:52 PM IST | Edited by : Joydeep Bose
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A report by Japan's leading think tank Japan Center for Economic Research (JCER) has predicted that the Indian economy will in the next 40 years see a fourfold increase and will, therefore, be the third leading economy in the world by 2060.
The Tokyo based think tank JCER, in its recent report on long-term economic forecast covering 65 economies, has found that India and China will account for 35% of Global GDP by the end of 2060. The combined GDP of these two countries is estimated to be close to that of the combined shares of the United States (US) and the European nations.
The figure highlights the four structural changes that will take place by 2060:
First, the United States and China will compete for economic hegemony in 2060.
Second, the Indian economy will become a major economy. India will increase its share fourfold during 2019-2060. By 2060, it will be third in the world.
Third, Europe's market share will be less than half of 1990, but still slightly larger than India. If European nations can stay firmly united, they will be able to maintain their presence as one of the poles of the world. However, Europe would lose its strength under extreme scenarios, such as other European country’s departure from the EU and conflict escalation between southern European countries and Germany.
Fourth, Japan will become a smaller and weaker country. Japan's share will fall to 3% in 2060 from 14% in 1990.
India's share is likely to rise from 4% of Global GDP in 2019 to 16% in 40 years from now which will also make India the third-largest economy in 2060. China, on the other hand, will be accountable for 20% of Global GDP in 2060, witnessing a rise from 17% in 2019.
China is predicted to be at No. 2 and the U.S. in the first place by then. JCER in its report continued to say that, India's strength is to maintain its population growth until 2060.
As China and India rise, the combined share of the U.S. and European economies will fall from over 50% in 2019 to 38% in 2060.
Behind the rise of China and India, a group of developed nations, including Japan, the United States, and Europe, will drop their GDP share from a slight under 80% in 1990 to 40% in 2060.
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