By 2023 India will overtake China, outpace developed nations

According to a Harvard study, India will overtake its South Asian economic rival China. It is also projected that India will achieve highest annual GDP growth rate of 7.9 % in next eight years.

Not only this, the Centre for International Development (CID) at the University stated that India would also leave developed countries behind as growth in emerging markets would continue.

The reported stated “after decades spent trailing the growth of its northern neighbour and economic rival, India now tops the projections of annual growth rates to 2023". India’s growth projection over next years is nearly double of China's 4.6% projected growth over the period.

Ricardo Hausmann, Professor of the Practice of Economic Development at Harvard Kennedy School (HKS) and director of CID, said the economic complexity predictions find India's disputed upper hand in growth will expand into a widening gap in the medium-term, with growth projections to 2023 predicted to be at 7.9% annually, well ahead of the 4.6% projected for China.

However, the study shows slowdown for China. China has posted 9.1% annual growth of the past quarter century. But stands just below the 6% growth rate in 2020 predicted by the IMF and China's leadership, the report said.

Using their own measure of economic complexity that analyses the productive capabilities in a country's exports, CID researchers also predict important reversals among growth leaders.

CID's projections are also bullish on East Africa. Four East African countries - Uganda, Tanzania, Kenya, and Madagascar - rank in the top ten, with all predicted to grow at least 6% annually.

The report also favours Pakistan with 5.1% growth projection, presenting a clear picture of South Asia and East Africa's positive growth outlook.

Southeast Asia also includes several high-growth countries, driven by its largest country, Indonesia, which is foreseen to grow at 5.2 % annually to 2023.

According to the report, outlooks for Europe and the US show little optimism. The US growth rate in 2023 is projected at 2.4%, while major European players range from 2.3% in Italy to 3.7 % in Spain.

Hausmann informed countries like India, Kenya, and the Philippines have made important recent gains in diversifying their exports into more complex products. He added that historically, these gains in economic complexity have translated into higher incomes, which puts them as the frontrunners globally for their growth prospects.