India to be the world’s fastest growing economy till 2024: Harvard Study.
New Delhi | by Rajeev Deshpande | TNN | Dec 26, 2015, 09.32 AM IST.
Projected to grow at 7%, India has the potential to be the world’s fastest-growing economy over the next decade till 2024, far outpacing China that could slow to 4.3%, says an influential study by Harvard’s Centre for International Development (CID) on the basis of the 2014 trade data, the latest available.
Helmed by Prof Ricardo Hausmann, who heads the CID and leads research for the ‘Atlas of Economic Complexity’, the study presents an optimistic picture for India based on increasing sophistication of its industry, ability to adapt to changing global demand and variety in exports.
“India has made important gains in productive capabilities, allowing it to diversify its exports into more complex products, including pharmaceuticals and even electronics,” Prof Hausmann says in a press release.
Hausmann notes that India’s recent gains in complexity of its economy along with an ability to continue improving will drive higher incomes. “This will position India to lead global economic growth over the coming decade,” he says.
Arguing that gains in economic complexity have historically translated into higher incomes, Hausmann says China has already realised these benefits and has doubled per capita income in less than a decade.
Along with growth projections, the CID released new country rankings in the 2014 economic complexity index, which incorporates data stretching back to 1962, that places India at the 42nd spot but notes an improvement by five positions.
The rankings continue to see Japan, Germany and Switzerland leading the table while the UK, the US and France (10th, 13th and 16th) have all slipped. Oil economies like Venezuela have slipped the fastest, supporting the notion that a surfeit of mineral wealth can be a curse as it makes governments lethargic and encourages rentierism.
Southeast Asia and sub-Saharan Africa have the top gainers clocking fast per capita growth. This includes China that has climbed an impressive 16 positions to 17th — even though its long-term prospects are dimmer — and South Korea at 4th having gained 11 positions.