The United States has taken advantage of its high inflation and the strength of the US dollar to constantly widen the distance between GDP and other countries.
Who else can surpass the United States?
I can't imagine that India has the time to surpass the United States in terms of arrogance.
According to recent data, in the first three quarters of this year, the average GDP of the United States was close to $7 trillion per quarter, and the annual GDP is expected to reach more than $27 trillion.
With last year's 25Compared to $5 trillion, 2023 has achieved a large increase, mainly due to the impact of prices** on GDP statistics.
Inflation leads to goods*** which increases the GDP value. However, this growth does not represent a real economic boom and productivity gain.
This water injection may make GDP growth look more exaggerated, but in fact does not reflect the true state of the economy.
The same phenomenon is seen in Germany. Since the beginning of this year, the German economy has experienced negative growth after deducting prices. However, due to the contribution of inflation, nominal GDP has increased significantly, and even surpassed Japan to become the top three in global GDP in one fell swoop.
By the same token, the fact that US GDP has widened in recent years is closely related to the highest inflation in 40 years.
In terms of real growth rates, the growth rate of the United States is far less than that of India, which is currently ranked fifth.
India's GDP growth rate will reach 7% by the end of FY2023, the Reserve Bank of India**. This growth rate excludes the impact of inflation and is therefore considered a real growth rate.
India** noted that India's total GDP will surpass that of the United States in the next 50 years.
Since 2014, India's GDP growth rate has averaged more than 6% and even reached more than 9% in 2022. This rapid growth has been supported by a number of factors, including reform measures, increased foreign direct investment, and growing middle-class consumer demand.
However, it is important to note that despite India's impressive growth rate, its total GDP is only 3$5 trillion. Despite the higher growth rate, the low base has led to a gradual widening gap between India and the United States.
On the other hand, it is relatively easy to achieve high growth rates due to the relatively small base of India's economy. But as India's economy continues to grow, the increase in base will make it more difficult to grow at a high rate.
In addition, India faces a series of challenges that could have an impact on its economic growth. First, widespread poverty and inequality can dampen growth in consumption and investment.
Second, India's infrastructure construction is a bottleneck, and only continuous improvement of infrastructure can support sustainable economic growth.
In addition to the above-mentioned factors, the biggest problem in India at present is its attitude towards foreign investment.
Challenges faced by foreign investors in the Indian market include cumbersome approval procedures, an unstable policy environment, and regulatory uncertainty. These problems have led to a distrust of foreign investors in India and prompted them to withdraw.
So, with so many complications in the face, it may be too early to discuss whether India will be able to overtake the United States in 50 years.