India Will Overtake China As World's Fastest Growing Economy In 2016

India will become world fastest growing economy by the year 2016-2017; with a growth rate of 6.5%, it will take China's place at the top, which would be growing at the same time at a rate of 6.3% per year. This projection has been released by the International Monetary Fund (IMF), in its World Economic Outlook Update on Tuesday.

 

The IMF has projected that India will grow at 6.3%, up from 5.8% in 2014. China grew at 7.4% in the year 2014.

One another forecast was also released on the same day - the United Nations World Economic Situation and Prospects (UN WESP). This prediction, slightly lower than the same of IMF, says that India will grow at 5.9% during 2015 and in 2016 it will grow at 6.3%.

Growth forecast for India will broadly remain unchanged as the weak demand will be compensated by the low oil prices. And the impetus provided by the Modi government in form of policy reforms will also provide a boost in the industrial and investment activity. 

Nagesh Kumar, Head of the United Nations Economic and Social Commission for Asia and the Pacific (UNESCAP) said, “India could overtake China but it must be taken note of that China has grown at high growth rates of 9 per cent to 10 per cent over decades and it is a much larger economy and India will have to work to sustain high growth rates over a period of time to be an engine of global growth.”

Mr Kumar also said that there is no substitute to government's increasing it public spending for infrastructure and bringing-in private investment to the country to sustain a considerable growth in a longer run.   

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