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Indian economy will overtake UK, Japan by 2035: Goldman Sachs
Shyam Bhatia in London |
October 13, 2003 08:21 IST
The Indian economy is expected to overtake the United Kingdom and Japan by 2035, making it the world's third largest economy after the US and China, according to a new report.
Global investment banking and securities firm Goldman Sachs says in the report that by 2050 China, Brazil, Russia and India will be ahead of the six largest industrial states in overall GDP.
"If everything goes smoothly, these four countries will become the most attractive region in the world for placing direct as well as portfolio investment," Goldman Sachs states in its report Brazil, Russia, India and China - A Road in 2050.
Its prediction is based on the assumption that the current six leaders of the world economy, USA, Japan, Great Britain, Germany, France, Italy, will experience only 2 per cent annual growth in the next half a century.
According to Goldman Sachs this will allow India to overtake Japan in GDP by 2032 and China to get ahead of the US by 2041.
Goldman Sachs senior analyst and co-author of the report Dominique Willson explained the calculations were based on existing trends in each of the four countries, including demography, a possible slowdown in growth and expanding production and services sectors.
"To achieve these results, the countries do not have to carry out any special economic policy in order to repeat the wonderful experience of 'Asian tigers'," Willson is quoted as saying. "It is enough to ensure macroeconomic stability, transparency of the economy and to work at improving public and market institutes, infrastructure and education."
The Goldman Sachs analysis comes on the back of reports that Europe's economic problems are worsening. French bank Societe Generale says France, Germany, Italy and the Netherlands are in recession. On the other hand China has replaced the UK as the world's fifth largest exporter and the Chinese economy is growing by 8 per cent a year.