India Possesses Potential Become Second Largest Economy, says Goldman Sachs

Investment bank Goldman Sachs recently released a report in which it predicted that India would surpass countries like Japan, Germany, and the United States to become the second-largest economy in the world by 2075.

According to the report, the growth will be fueled by favourable demographics, innovation and technology, increased capital investment, and rising worker productivity. India is currently the world's fifth-largest economy, after the US, China, Japan, Germany, and UK.

According to Santanu Sengupta, economist for India at Goldman Sachs Research, "over the next two decades, India's dependency ratio will be one of the lowest among regional economies."

India has advanced in innovation and technology more than some people may realise. Yes, the nation benefits from favourable demographics, but GDP won't be solely influenced by these factors. The fifth-largest economy in the world is going to need innovation and higher worker productivity. Technically speaking, that means the Indian economy will produce more with each unit of labour and capital, according to Sengupta.

According to the report, the Indian government's emphasis on improving the nation's roads, railroads, and other infrastructure could very well be the growth engine. It made the case that the private sector should act now and build capacity in manufacturing and services to create more jobs and sift through the large labour force.