‘India tops list of fastest growing economies for coming decade’ : The Tribune India

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‘India tops list of fastest growing economies for coming decade’

NEW YORK: India tops the list of the fastest growing economies for the coming decade and is projected to grow at 7.9 per cent annually, a report says.

‘India tops list of fastest growing economies for coming decade’

The Centre for International Development at Harvard University (CID) said in new growth projections on Thursday that countries that had diversified their economies into more complex sectors, like India and Vietnam, were those that would grow the fastest in the coming decade.



New York, May 4

India tops the list of the fastest growing economies in the world for the coming decade and is projected to grow at 7.9 per cent annually, ahead of China and the US, according to a Harvard University report.

The Centre for International Development at Harvard University (CID) said in new growth projections on Thursday that countries that had diversified their economies into more complex sectors, like India and Vietnam, were those that would grow the fastest in the coming decade. 

“India tops the list as the fastest growing country for the coming decade, at 7.9 per cent annually, in the economic complexity growth projections. India has made inroads in diversifying its export base to include more complex sectors, such as chemicals, vehicles and certain electronics,” the report said.

It said India’s productive capabilities far exceeded expectations for its current income level, which contributed to the projection of rapid growth for the coming decade.

The researchers also find India ranks the best on the criterion termed the Complexity Opportunity Index (COI), which measures how easy it is to redeploy existing knowhow to enter new complex products. 

“India’s existing capabilities have not only diversified its exports, but also allow for easy redeployment into related products that depend on those capabilities, making further diversification relatively easy,” it said.

China is projected to grow at 4.9 per cent annually to 2026, the US three per cent and France 3.5 per cent. 

The top ranking in COI means India has many “unrealised opportunities” to diversify into related, high-value sectors to continue to drive productivity growth and job creation.

“Up to now, that potential remains unrealised, however, as India’s complexity has not changed over the past decade. The rapid growth that is predicted is effectively capitalising on previous gains in complexity,” the report added.

It stressed that ensuring the long-run potential of India’s economic growth would rely on realising diversification into related products. The other major challenge will be to ensure the inclusive nature of this productive transformation, as the gains made in new chemical, vehicle and electronics exports are highly concentrated in specific localities of the subcontinent.

“Whether that knowhow can be disseminated into new areas of India will in part determine whether rapid growth can be sustained in the long term,” it said.

Director of CID, professor at Harvard Kennedy School (HKS) and the leading researcher of The Atlas of Economic Complexity, Ricardo Hausmann, said Southeast Asia continued to dominate the global growth landscape, driven by the diversification of economies into complex manufacturing, but the leading countries had shifted within the region, with the Philippines, Vietnam, Indonesia and Thailand poised to lead growth in the coming decade.

Uganda comes second on the list of the fastest growing economies to 2026, predicted to grow at 7.5 per cent annually. The growth projections are based on economic complexity, a single measure of each country’s economy which captures the diversity and sophistication of the productive capabilities embedded in a country’s exports.

The report further noted that after a decade of growth driven by record oil and commodity prices, the researchers find a landscape that has shifted in favour of more diversified economies. In sub-Saharan Africa, growth is shifting eastward from commodity-driven West Africa to East Africa, with Uganda, Tanzania (4th), and Kenya (10th) in the top 10 predicted fastest growing countries globally for the coming decade. 

The researchers further point out that many low-income countries, including Bangladesh, Venezuela and Angola have failed to diversify their knowhow and face low growth prospects.

“Others like India, Turkey and the Philippines have successfully added productive capabilities to enter new sectors and will drive growth over the coming decade,” said Sebastian Bustos, a lead CID researcher in trade and economic complexity methods. PTI

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