Economic relegation for the UK, as India’s economy will be sixth largest for the first time in over 100 years.
India’s economy has leapt forward and overtaken the United Kingdom for the first time in over 100 years, now standing as the world’s sixth largest economy by GDP after Untied States, China, Japan, Germany and France.
India’ rapid economic growth over the last 25 years as well as Britain’s recent woes with Brexit, one expected India to overtake the UK GDP in 2020, catalysed by 20 per cent decline in the value of the Pound Sterling over the past 12 months. Uk’s 2016 GDP of GBP 1.87 trillion converts to $2.29 trillion at exchange rate of GBP 0.81 per $1, where as India’s GDP of INR 153 trillion converts to $2.30 trillion at exchange rate of INR 66.6 per $1.
Only last February, it surpassed China as the world’s fastest growing economy and in October 2016, the International Monetary Fund predicted India would retain that title in the near future, its GDP is projected to increase by 7.6 per cent through 2017.
The United Kingdom is projecting growth by only 1,8 per cent in 2016 and 1.1 per cent in 2017.
The Indian industry contributes 7 per cent of India’s GDP, employs millions and is a major source of its foreign exchange earnings. The jewellery industry created US$37 billion in economic output on value added basis.
1947 gave India to chart its own economic path, and not until 1991 India broke out of its mold and in 2016 it is celebrating a historic and emotional milestone of economically overtaking its former coloniser.
According to IMF, India’s economy clearly benefited from a global commodities price slump through large trade gains and lower than expected inflation.
Several reforms from creating unified national taxes to deregulating the agricultural industry’s fertiliser and the recent currency demonetisation to root out corruption and tax dodging which affected 86 per cent of India’s currency in circulation resulted in plummeting business transactions, interrupted salary payments, and caused notoriously long queues at banks nationwide as people went to withdraw their cash for basic needs.
On 7th November 2016, when UK Prime Minister Theresa May visited India stated “ Indian investment is helping UK to diversify our economy”.
