India becomes fifth largest economy in the world, overtakes UK

Stuid

Updated on September 6, 2022

According to a report, India has become the fifth largest economy in the world overtaking the United Kingdom (UK). The high cost of living turned out to be a major setback for the UK, allowing India to claim the fifth spot in the world rankings of largest economies. The feat was achieved in the last three months of 2021. This is not the first time India is surpassing the UK in terms of economy, India had earlier pipped the UK to emerge as the fifth largest economy in the year 2019. But then Covid arrived to spoil the party for our country, pushing it back to the sixth position once again.

According to the Bloomberg report, the size of the Indian economy with respect to ‘nominal’ cash was $854.7 billion during the quarter through March. On the other hand, the same for the UK was $814 billion. The calculations were made on an adjusted basis, taking into consideration the dollar exchange rate on the last day of the relevant quarter.

GDP figures from the International Monetary Fund suggest that India has further extended its lead in the first quarter of the current financial year. The whole calculations are based on US Dollars.

As per the Bank of England, the UK is staring at a recession that may extend into the year 2024. The United Kingdom is currently witnessing its inflation grow at the fastest pace in four decades which is an alarming trend. The war in Ukraine and the persistent effects of the pandemic seems to have an adverse impact on the UK economy. In contrast to this, the Indian economy is expected to grow more than 7 per cent this financial year.

The United States of America is the largest economy in the world. Its toughest competitor China holds the second spot. Japan holds the reputation of being the third largest economy in the globe. Closely followed by Germany and India respectively.

As per the information from government sources, India’s gross domestic product (GDP) witnessed a rise by 13.5 per cent in the June 2022 quarter of FY 23. Even though economists in the country are forecasting a slow economic growth taking into consideration several negative factors, this time round India is expected to hold on to its fifth position for a longer period of time.

Edging past England may be the perfect launchpad for India to scale greater heights in the world economy. Our country’s dream of being a $5 trillion economy can actually be achieved and the possibilities of being the third largest economy can soon turn into a reality.

As per the IMF projections, India is expected to surpass Germany as the fourth largest economy in the world in the next five years. Considering that India was ranked 11th among the world’s largest economies a decade ago, these are sparkling achievements!

With western economies suffering from the double whammy of pandemic and the Russia-Ukraine war, the road ahead looks challenging for these countries in the race for becoming economic superpowers.

Even the mighty China has come under economic stress, the covid hit country has been further crippled by the mounting debt in its real estate market, making the future challenging for the nation. In short, in contrast to the gloomy global picture, the Indian economy looks to be in better shape and can be rightly called as the fastest growing economy amid the global slowdown!