India continues to be the best-performing major economy in the world, a crucial aspect to consider for its upcoming elections.
India forecasts a 7.3% GDP growth in 2023, as the world’s largest democracy prepares for elections in 2024. If these numbers are accurate, India is the fastest-growing emerging economy in the world.
This projection comes from the National Statistics Office, while the Reserve Bank of India posted a similar prediction in December.
The Indian economy grew 7.2% in 2022 and 8.7% in 2021, rebounding from the Covid crisis (India suffered the third highest death toll in the world). If this trend continues, S&P Ratings predicts, India will become the world’s third-largest economy by 2030, overcoming Germany and Japan.
Private consumption, accounting for 58% of GDP, expanded by 4.4% compared to 7.5% in 2022. Government spending, on the other hand, grew 4% in 2023 compared to just 0.1% the previous year.
Manufacturing also heavily increased in 2023, growing by 6.5% in 2023. Prime Minister Narendra Modi is attracting American and Western companies to increase investment in the country, diverting them away from China.
Apple, the world’s largest company, is especially attracted by India as a growing market. China recently enacted a ban on iPhones for government officials, and Chinese companies are ramping up competition.
Nevertheless, India still faces significant societal challenges. GDP per capita is $2,389, ranking 143rd in the world and sitting below Congo, Angola, and Ivory Coast.
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The 2024 elections
India is the world’s most populous democracy, and its elections are considered among the most important in 2024. Prime Minister Modi announced they will take place before May.
According to analysts interviewed by CNBC, the Indian economic boom will ensure Modi a third term in office. So far, his tenure lasted two terms, or 10 years, since 2014.
Elections in India usually take several weeks to complete. Reaching polling stations is often a difficult journey for the rural population, and counting all the votes takes a lot of time and is often not completely accurate.
Nevertheless, Modi proved to the world that India is ready to step on the world stage. Investment in the country increases as trust in China plummets.
Modi wants to prove to the Indian population that New Delhi will replace Beijing. At the same time, he places India squarely within the military umbrella of the United States, even though its allegiance to the US dollar is shaky at best.
So far, GDP growth has proven Narendra Modi right. If India continues on this path, it will become a major player on the world stage.
