Hyderabad: The Brexit-induced fall in the pound sterling could lead to something most Indians may feel happy about: India will overtake its erstwhile colonial master United Kingdom in terms of the size of the economy — the first time after nearly 150 years.
According to IMF projections made before the Brexit vote, the UK’s economy was expected to be worth $2.76 trillion in 2016 — the fifth largest followed by France at $2.46 trillion.
However, the unprecedented depreciation in the pound has shrunk the size of the UK’s economy to $2.34 trillion. As a result, it slipped to the sixth position and helped France to rise to fifth slot.
As per the IMF ranking, India was the seventh largest economy worth $2.29 trillion — just $50 billion less than the current UK’s GDP, which will be bridged by end of this fiscal.
With a growth forecast of 7.6 per cent by IMF, India would add $174 billion to its GDP next year, taking its economy size to $2.46 trillion. At an IMF forecast growth of 1.1 per cent, the UK’s economy would be $26 billion next year, taking it to $2.37 trillion — $100 billion less than India’s — if the pound retains the current exchange and its economy doesn’t suffer from the EU’s hard stance.
With the UK out of its way due to Brexit, India is predicted to overtake France in 2018, catapulting itself to be the world’s fifth largest economy. According to the IMF, Indian GDP would be worth $2.72 trillion next year compared to France’s $2.6 trillion. In the absence of Brexit, India would have had to wait till 2020 to unseat the UK from its fifth slot.