India To Leapfrog Over Japan and Germany to Claim 3rd Spot in Global Rankings by 2030

India will have leapfrogged over Japan and Germany to claim the third spot in global rankings by 2030 riding on its service sector strengths, according to Bloomberg chief economist Tom Orlik.

Speaking at the launch of a new index that Bloomberg introduced – a new benchmark that measures competitiveness against the new disruptive forces like automation, digitisation, climate change, protectionism, and populism, Orlik said India could gain most from its edge in the services ector. Hence, though ranked 43rd by traditional measures of drivers of growth, it could move ahead rapidly because of its strength in the services sector and digital sector advantage.

“Twenty years ago, China’s economy was a tenth the size of the US. In 2019, it is two thirds as big. In 2039, on the current trajectory, it will be more than 10% bigger. India will have leapfrogged Japan and Germany to claim the No 3 spot in the global rankings,” Orlik said.

“Most of the gains are going to come from the services economy. India is going to add 130 million secondary educated work force by 2030. At the same time, China’s workforce will reduce by 30 million. Most of these are likely to be employed by services and digital economy,” said Orlik. India is also relatively insulated from the rise in protectionism because of its manufacturing exports are not very high. “India today looks a bit like China at the beginning of the economic boom,” Orlik said.

China had three big factors in its favour. They had positive demographics, a government determined to push through far reaching economic reforms and favourable geo-political environment. These three together propelled the favourable growth for China, he added.

India too looks similar in some respects according to Orlik.

Source: ET

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