India economy is expected to be bigger than the United States over the "long term" while neighbouring China would emerge as the world's largest economy by 2016, according to Paris-based think tank OECD.
"The United States is expected to cede its place as the world's largest economy to China, as early as 2016. India's GDP is also expected to pass that of the United States over the long term. "Combined, the two Asian giants will soon surpass the collective economy of the G7 nations," it said.
Currently, Indian economy is worth over USD 1 trillion. The grouping noted that fast-ageing economic heavyweights -- such as Japan and the euro area -- will gradually lose ground on the global GDP table to countries with a younger population such as Indonesia and Brazil. Going by OECD, large cross-country differences would persist. "China will see more than a seven-fold increase in per capita income over the coming half century, but living standards will still only be 60 per cent of that in the leading countries in 2060.
"India will experience similar growth, but its per capita income will only be about 25 per cent of that in advanced countries," the report said. OECD has projected the world economy to grow three per cent annually. "Cross-country GDP per capita differences mainly reflect differences in technology levels, capital intensity, human capital and skills," it said.
OECD Secretary-General Angel Gurria said that as the largest and fastest-growing emerging countries fully assume a more prominent place, "we will face new challenges to ensure a prosperous and sustainable world for all". "Education and productivity will be the main drivers of future growth, and should be policy priorities worldwide," he added.
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