India to be the third largest importer by 2050: report from the UK

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With a growing middle class and soaring discretionary spending, India will be the third largest importer in the world, accounting for 5.9% of global imports by 2050, just behind China and the US, according to a new report that falls below its projected rank mimicking the world’s economies. India is currently eighth of the largest importing nations with an import share of 2.8% and is expected to become the fourth largest importer by 2030.

“The US and EU share of most import sectors is expected to decline by 2030 as the growing purchasing power of the Asian middle class accounts for a growing share of global import demand. This change is particularly pronounced in the food, travel and digital services sectors, where a larger and increasingly affluent population in the Indo-Pacific is expected to consume more discretionary goods and services, ”reads the UK Department of International Trade’s latest Global Trade Outlook .

The world’s economic center of gravity has shifted eastward for decades due to the rapid growth in the Indo-Pacific, causing trade patterns to shift over time. “Between 2019 and 2050, 56% of global growth is expected to come from the Indo-Pacific, compared to a quarter from the EU and North America combined. Growth in the Indo-Pacific is also expected to rebalance over time, with South Asia’s contribution (driven by India) increasing, ”he added.

China is a major driver of this eastward economic shift as it is expected to become the largest economy in the world by 2030. China already ousted the US in terms of purchasing power parity (PPP) (which makes up the differences in local prices) in the mid-2010s. However, based on the market exchange rates more relevant to trading, the change is expected to occur around 2030. “At that point, both countries will account for around 22% of global GDP,” the report said.

The report forecast that by 2050 India will jump to third place in the ranking of the world’s largest economies, accounting for 6.8% of global GDP, just behind China and the US. India currently ranks fifth in the world economy with a share of 3.3%. India’s GDP is expected to cross Germany by 2030 and become the fourth largest economy.

“The role of emerging economies in the trading system will increase over time in line with their growing weight in the global economy,” the report said.

The “E7 group” of the seven largest emerging countries – China, India, Brazil, Russia, Indonesia, Mexico and Turkey – is to achieve the G7 share of global import demand by 2050. The seven richest countries in the world – Canada, France, Germany, Italy, Japan, Great Britain and the USA – belong to the G7 group


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