Latest News | 'India Pipped UK to Be 5th Largest Economy in Dec 2021, 6-6.5% Growth New Normal'

Mumbai, Sep 3 (PTI) The Indian economy overtook the United Kingdom in December 2021 itself to be the fifth largest in the world, economists at SBI said on Saturday.

Stating that real GDP growth of 6-6.5 per cent in a world full of uncertainties is the new normal, the economists said India is set to be the third largest economy by 2029.

Also Read | India's Exports Remain Flat at USD 33 Billion in August 2022; Trade Deficit Widens to USD 28.68 Billion.

The note came on a day when a section of the media reported that India has become the fifth largest economy, days after the release of official data for the June quarter which showed a 13.5 per cent growth on a year-on-year basis.

"…(India) is now the 5th largest economy. Interestingly, India had surpassed the UK as the 5th largest economy as early as December 2021 itself and not recently as is being claimed," the note by the SBI economists said.

Also Read | India Set To Become World's 3rd Largest Economy by 2029, Says SBI Report.

It said the country has seen a large structural shift in the Narendra Modi regime, and its share of the world GDP has now increased to 3.5 per cent as against 2.6 per cent in 2014 when he took over as the Prime Minister. The same is likely to cross 4 per cent in 2027, which is the present share of Germany.

The report said India was 10th largest economy in the world in 2014 and will surpass Germany in 2027 and Japan in 2029 to be the third largest in the world.

A slowdown in investments into China is likely to benefit India in the coming days, it said, pointing to mobile handset maker Apple's intention to produce the latest phone model from India as being illustrative of the optimism.

Pointing out that China embarked on an accelerated growth path at the beginning of the current century which helped it to become the second largest economy, the report said the “right policy perspective and realignment in global geopolitics” can also lead to an upward revision in its estimates for India.

The report also pitched for a revision in the IIP basket, calling the current set of indicators used "hopelessly outdated".

It said the IIP basket was last updated in 2012, and does not take into account recent phenomenons like handset exports by companies in Foxconn from India, and added that manufacturing growth will get a leg up if the basket is updated.

(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)