Though there are multitudes of indices out there, still GDP growth rate has maintained its status as a numero uno predictor of a country’s economic health. This is exactly where India has struck the world with lightning speed. Data based analysis clearly shows that no country fares or in fact will fare better than India.
India’s stupendous GDP growth rate
GDP numbers for the April-June quarter are out now. Latest estimates reveal that India’s GDP expanded by a humongous 13.5 per cent in Year-on-Year terms in the given quarter. Apparently, this is the second highest annualised growth rate compared to 20.1 per cent during the same period last year. But last year’s growth has a caveat to it. It did not show the full picture of the story.
Last year’s high growth is mainly attributed to the base effect caused due to GDP contraction in the same time period of 2020. Its foundation was quite low. But, this time around, the growth rate deserves more applause because of higher productivity.
Also read: India grows by 23 per cent! India’s GDP growth rate post lockdown is picking up at a breakneck pace
American continent is nowhere close
The applause gets much bigger when we start comparing India’s GDP growth rate to other economies in the world. No country, I repeat no country, whether it is developed like that of the USA, or rapidly developing countries like China, Brazil could beat India. Here are the official numbers.
First let’s have a look at the growth rate of “The Great Experiment”. America as it is more popularly known has entered into technical recession. In year-on-year terms, the Biden administration oversaw 0.6 per cent decrease in its GDP growth rate. But, somehow it is positive news for Americans because of the growth rate of -1.6 per cent registered in the previous quarter.
Its brother Canada performed better than the US. In spite of Truckers’ protests and other internal problems halting the Canadian economy, official statistics show the Canadian economy expanding at the rate of 3.30 per cent.
Top 2 economies in Europe are crumbling
Coming to the Eurozone, it won’t be sufficient to say that the continent is in tatters. They are on the verge of destruction. Germany, the largest economy of Europe grew only 1.7 per cent in YoY terms. Situation is so grim in Germany that people of the country which historically has been the most industrialised economy of Europe are down to cutting trees for fire.
The United Kingdom, its toughest competitor in the continent, is not in a good state either. While having nearly 30 per cent less GDP than Germany, it could only grow by 2.9 per cent. However, not every country is doomed in Europe.
Also read: For Leftist economists, 20.1% GDP growth is proving to be too tough to digest
Bottom 3 give hope
France, Italy and Spain did give a glimmer of hope to Europeans. Charismatic Macron helped the French economy grow at a reasonable rate of 4.2 per cent in YoY terms. Italy, the 4th largest economy of Europe performed slightly better than France with the growth rate of 4.6 per cent.
Spain, the country sitting at the 5th position in Europe’s largest economies, was the one which showed the most improvement. It grew at the rate of 6.3 per cent in the aforementioned period.
Asia is not good either
While the western faction of the developed world is finding it tough to sustain itself, the situation is not much better in Asia as well. Japan, the shining light on Asian continent, could only grow at the rate of 2.2 per cent.
Apparently, even the developing section of Asia has not been able to gain momentum. Countries such as Sri Lanka, Bangladesh, Pakistan, Afghanistan and Nepal are looking towards the possibility of civil war all thanks to the collapse of their economy.
China has taken down its various BRICS partners
China, the country which is responsible for sending these nations into this state is also looking down the abyss. Even with his full authoritarian response to the looming crisis, Xi Jinping could not crank up his workforce. It seems as if Chinese workers are just refusing to participate in the economy and the GDP growth rate of 0.4 per cent is a prime example of the discontent among economic agents in China.
Impact of the Chinese slowdown was visible in its trading partner Brazil as well. While the Jair Bolsonaro administration has not yet released its growth numbers, the IBC-Br economic activity index indicated that the economy will grow at a paltry rate of 0.69 per cent. South Africa, its BRICS partner and another developing country like Brazil and China is just trying to stand on its feet. In the first quarter of this year, the country of AB Devillers grew at the rate of 1.9 percent.
All these countries shouldering the responsibility of carrying forward the Global growth rate could escape the responsibility by blaming it on Covid. But, the problem is, Covid is two and half years old now and its effects have subsided. India’s GDP growth rate going above pre-pandemic level is an example of that.
Also read: China loses GDP growth rate race with India
Future is grimmer
On the other hand, future hope for these countries is also dim. The poor policies are now reflected in future predictions as well. In its July 2022 World Economic Outlook report, the International Monetary Fund has predicted a not so good future for the world economy, barring India of course. In fact, India is slated to be the fastest growing major economy in the IMF’s report.
The IMF estimates that India will grow at the rate of 7.4 per cent in FY22, while China will grow at less than half of India’s rate. Its economy will only expand by 3.3 per cent. The Euro Area will grow by 2.6 per cent with Spain clocking the highest rate with 3.0 per cent. Their friend the United States will perform worse than them with a 2.3 per cent increase in GDP.
India is a clear outlier among big boys of Economic development. It has been possible only because of the Modi government’s redistribution policy coupled with a push towards long-term infrastructure creation. A huge chunk of credit goes to our young population as well, especially for maintaining demand in the economy.
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