Shillong, July 11: According to a report by investment bank Goldman Sachs, India is expected to become the world’s second largest economy by 2075, surpassing Japan, Germany, and the United States. Currently, India holds the position of the 5th largest economy globally.
Goldman Sachs attributes this projection to several factors, including favorable demographics, innovation and technology, increased capital investment, and rising worker productivity.
The report highlights that India’s dependency ratio, a measure of the working-age population relative to the non-working-age population, is projected to be one of the lowest among regional economies over the next two decades.
According to India Today, Santanu Sengupta, Goldman Sachs Research’s India economist, emphasizes the importance of innovation, increasing worker productivity, and capital investment as drivers of India’s growth. He states that while demographics are advantageous, they alone will not determine GDP growth. The focus should be on achieving greater output for each unit of labor and capital in India’s economy.
The report also suggests that India’s savings rate is expected to rise due to declining dependency ratios, increasing incomes, and the development of a more robust financial sector. This is likely to enhance the availability of capital for further investment.
Goldman Sachs acknowledges the Indian government’s emphasis on infrastructure development, particularly in the areas of roads and railways. The report encourages the private sector to seize the opportunity and expand capacity in manufacturing and services to generate more job opportunities and absorb the country’s large labor force.
