By Adnan Syed
This three part series examines the rise of India as an economic giant, the threats that India faces in this remarkable rise, and implications for Pakistan.
The Rise of India
Indian economic growth is expected to be 8.50% this year. This is a remarkable rate of growth for any economy. But this rate is dwarfed by the double digit growth rates that China has been producing for the last 10 years. India’s growth rate is expected to accelerate in the coming years, and Morgan Stanley expects that within next three to five years, this growth rate will outpace the Chinese rate of growth. Many economists are now forecasting that India would have the best economic performance among all nations of the world for the next 25 years.
The biggest reason for this higher expected growth rate is the demography. Economic growth of any nation relies on increase in workers (or the working age population) and increase in productivity. In 2040, India would have 58% of population as workers. The same number for China is only around 40%. India’s working age population will increase by 136 million over the next 10 years. China’s will grow by mere 23 million. To give some idea, during the similar time frame, the European working population will decline by 15 million over the next 10 years.[i]