India could match China’s growth within two years: World Bank
14 Jan 2015
The World Bank says India would catch up with China in terms of GDP growth in just a year or two, helped by the economic reform measures taken by the Narendra Modi government which came to power in May last year.
"According to our analysis, India will catch up with China's growth in the year 2016 and 2017," World Bank chief economist and senior vice-president Kaushik Basu told reporters in Washington on Tuesday.
He was speaking on a conference call as the bank released its latest Global Outlook: Disappointments, Divergences, and Expectations Global Economic Prospects report.
"China's growth will remain high, but will begin to taper very gently, reaching 6.9 per cent in 2017," Basu said.
The World Bank in its report forecast a growth rate of 7 per cent in the fiscal year 2016 and 2017, as against China's 7 per cent and 6.9 per cent.
The World Bank estimated a growth rate of 5.6 per cent for India in the current financial year and a growth rate of 6.4 per cent in 2015, while for it is estimated at 7.4 per cent in 2014 and 7.1 per cent in 2015.
In its report the Bank said growth in South Asia rose to an estimated 5.5 per cent in 2014 from a 10-year low of 4.9 per cent in 2013.
"The upturn was driven by India, the region's largest economy, which emerged from two years of modest growth," it said.
Regional growth is projected to rise to 6.8 per cent by 2017, as reforms ease supply constraints in India, political tensions subside in Pakistan, remittances remain robust in Bangladesh and Nepal, and demand for the region's exports firms, it said.
"Past adjustments have reduced vulnerability to financial market volatility. Risks are mainly domestic and of a political nature. Sustaining the pace of reform and maintaining political stability are key to maintaining the recent growth momentum," the report said.