Thursday, 28 October 2021

3rd largest importer will be India by 2050

3rd largest importer will be India by 2050

Growing middle class and its rising voluntary spending, India will become the world’s third-largest importer by the year2050 with a share of 5.9% of global import, right ahead only China and the US, the report said, mimicking its projected ranking among world economies. India is ranked eighth among the largest importing nations with a 2.8% import share and will become the fourth-largest import country in 2030.

“The US and the EU sharing the most import sector is expecting to decline out in 2030 as the growing purchase power of Asia’s middle-class accounts for a increasing share of global import demand. This change is particularly marked in the food, travel and digital services sectors where larger and increasingly wealthy populations in the Indo Pacific are expected to consume more discretionary goods and services,”

The latest Global Trade Outlook issued by the UK’s Department of International Trade said.

It added.

The center of the world’s economic gravity has been shifting eastward for decades due to the rapid growth in Indo Pacific, causing trade patterns to change as it moves.

“Between 2019 and 2050, 56% of global growth is expected to come from the Indo Pacific, compared with a quarter from the EU and North America combined. Growth within the Indo Pacific is also expected to rebalance over time, with South Asia’s contribution (driven by India) rising,”

China is a significant driver of this eastward economic shift as it is expecting to become the world’s largest economy by 2030. China already displaced the US in Purchasing Power Parity (PPP) terms (which account for differences in local prices) in the mid-2010s. But based on market exchange rates, which are more relevant for trade, the change is expected to happen around 2030.

3rd largest importer by 2050 will be India after China and the USA 1pixabay image

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The report said.

“At that point, both countries will account for around 22% of global GDP,”

The report projected that India would leapfrog to third place by 2050 in the ranking of the world’s largest economies, just behind China and the US, with a share of 6.8% in global GDP. At present, India is ranked fifth in the world’s economies, with a share of 3.3%. India’s GDP is projecting to cross Germany by 2030 to become the fourth-largest economy.

The report said

“The role of emerging economies in the trading system will rise over time, consistent with their growing weight in the global economy,”.

The ‘E7 group’ of the seven largest emerging economies—China, India, Brazil, Russia, Indonesia, Mexico, and Turkey—are projected to equal the G7’s share of global import demand by 2050. The seven wealthiest countries of the world—Canada, Germany, France, Italy, Japan, the UK, and the US—are part of the G7 grouping

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