India will be the world’s largest economic powerhouse by the end of the century, with a GDP 90 percent larger than China’s and 30 percent larger than the United States.
India will maintain strong growth, averaging 6.5% from 2024 to 2028, and will overtake Japan and Germany as the world’s third-largest economy by 2032. Based on population estimations and projections, India is predicted to surpass both China and the United States by 2080. The country’s big and youthful population, a burgeoning middle class, a thriving entrepreneurial sector, and greater global economic connectivity will all be major growth drivers. India must address issues such as poverty alleviation, inequality, human capital development, infrastructural development, and environmental sustainability.
In 2022-23, India saw 7.2 percent GDP growth. Growth will moderate somewhat to 6.4% in 2023-24, with output exceeding pre-pandemic levels by 17.2%. Despite significant output growth due to food and energy price shocks, inflation is expected to close at roughly 5.5 percent in 2023.
The International Monetary Fund (IMF) recently cautioned that India’s general government debt could approach 100% of GDP in the medium term. In 2023, the government’s borrowing is expected to be 8.8 percent of GDP. This indicates an expansionary posture, as evidenced by increasing spending on infrastructure, healthcare, and social welfare.