The rapid growth in India in the last 25 years and the decline in the United Kingdom (UK) following the Brexit vote has resulted in India surpassing its erstwhile colonial master in terms of the size of the economy - for the first time in more than 100 years, a report has said.
“This dramatic shift has been driven by India’s rapid economic growth over the past 25 years as well as Britain's recent woes, particularly with the Brexit,” a report by the Forbes magazine said.
The surpass was expected to take place in 2020 but was accelerated by the nearly 20 per cent decline in the value of the pound over the last 12 months.
"Once expected to overtake the UK GDP in 2020, the surpasso has been accelerated by the nearly 20 per cent decline in the value of the pound over the last 12 months, consequently UK's 2016 GDP of GBP 1.87 trillion converts to $2.29 trillion at exchange rate of GBP 0.81 per $1, whereas India's GDP of INR 153 trillion converts to $2.30 trillion at exchange rate of INR 66.6 per $1," the report said.
This gap is expected to widen as India grows at the rate of 6-8 per cent while UK’s growth is expected to be around 1-2 per cent per annum until 2020.
“Even if the currencies fluctuate that modify these figures to rough equality, the verdict is clear that India’s economy has surpassed that of the UK based on future growth prospects,” Forbes said.
“1947 gave India agency to chart its own path; 1991 broke India out of its mold; and hopefully 2016 shall give India conviction and help it redouble its efforts towards convergence after celebrating a historic and emotional milestone of economically overtaking its former colonizer,” it said.
On October 8, this year, International Monetary Fund (IMF) had predicted this to happen by the end of the fiscal.
"India is the seventh largest economy worth $2.29 trillion - just $50 billion less than the current UK's GDP, which will be bridged by end of this fiscal," IMF had said.
