Billionaire investor Mark Mobius has expressed optimism about the potential of India to become the second-largest economy in the world. Currently the fifth-largest economy in the world, India has managed to record extraordinary growth over the last few years, moving up from the 11th position. Due to its high growth rate and right policy initiatives, the country will overtake Japan and Germany within a few years to follow and India to become world’s second-largest economy.
Mobius pointed out India’s demographic edge as one of the main sources of its economic growth. With more than 1.2 billion people, India boasts a younger and more fertile labor force than that of aging economies like China. The demographic dividend coupled with an expanding middle class places India in the center as a destination for innovation, consumption and productivity.
Policy reforms and manufacturing capacity
India’s economic resilience is supplemented by ongoing policy reforms to promote a business-friendly climate. Mobius demanded that removal of import controls—tariff and non-tariff barriers—is essential to unleash the true potential of the manufacturing sector. In this manner, India would attract foreign investment, improve exports and firm up its industrial base.
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In spite of worldwide uncertainties, India’s stock market has been very resilient. Mobius believed that the market has corrected but remains a good bet for investors. He advised long-term investors to focus on good stocks and ride out the volatility of markets because India’s economic fundamentals are strong.
According to the latest estimates of the International Monetary Fund (IMF), India’s real GDP will reach $4.3 trillion by 2025, narrowly behind Japan’s $4.4 trillion and Germany’s $4.9 trillion. At its current growth rate, India will surpass Japan this year and Germany in 2027. Mobius believes that with consistent policy and well-designed investments, India can eventually become the world’s second-largest economy.
India’s journey to emerge as the second largest economy in the world is a testament to the nation’s resolve, resilience, and demographic strength. By persisting in ushering visionary policy into practice, the country is well on its way to joining this lofty achiever’s table.
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