First published September 3, 2022 at 11:38 am IST
India overtook the UK on Friday to become the world’s fifth largest economy. The change in ranking has pushed the UK up to sixth place as the country continues to struggle under the brutal cost of living budget.
This year, the Indian economy is expected to grow by more than 7 percent. On an adjusted basis and using the dollar exchange rate on the last day of the relevant quarter, the size of the Indian economy in ‘normal’ cash terms was US$845.7 billion for the quarter ended March. On the same basis, the UK was worth $816 billion, according to the report.
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In a report, the IMF’s own forecasts show India overtaking the UK in dollar terms this year, putting the Asian powerhouse behind the United States, China, Japan and Germany. A decade ago, India was the 11th largest economy, while the UK was fifth.
The government expects the economy to grow by 7-7.5 percent in 2022-23, in line with its projections earlier this fiscal year. India recorded 8.7 percent growth in 2021-22.
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On Wednesday Finance Minister TV Somanathan said: “We remain on track to reach the 7.4 percent. We expect to achieve this. This does not really reflect expected annual real GDP growth. So 7-7.5 percent in this range. 7.4 percent is what the IMF forecast.”
The statement came after the release of GDP figures, which showed the economy grew 13.5 percent in the April-June quarter, well below the RBI’s forecast of 16.2 percent.
In a tweet, Union Minister Rajeev Chandrasekhar said: “India will become the world’s fifth largest economy on the same day it removes the last symbol of British colonial rule from our navy.”
“PM @narendramodi ji’s aim is for India to reach 100 before the 100th birthday in the coming decade.
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Mahindra Group Chairman Anand Mahindra also took to Twitter and said, “The law of karma works. Messages that would have filled the hearts of any Indian who has fought hard and sacrificed much for freedom. And a silent but strong response to those who thought India would descend into chaos. A time for quiet reflection, gratitude.”
Senior policy analyst Kanchan Gupta said: “India is racing ahead of Britain to become the world’s fifth largest economy and also the fastest growing. #India has leapfrogged #Britain for the last three months of 2021. India extended its lead in the first quarter, according to IMF GDP numbers.”
India’s GDP grew at its fastest pace in a year at 13.5% in the April-June quarter, supported by a favorable base, robust growth in agriculture, services, construction and personal consumption. In the previous quarter (January-March of FY22), the country’s gross domestic product (GDP) grew 4.1%, according to data released by the Ministry of Statistics and Programs Implementation (MoSPI).
Last updated September 3, 2022 11:41 am IST