Bank of America predicted India’s economy third place in world

In ten years, India will become the third largest economy in the world and will cost Japan on nominal GDP. Such forecasts are given in the Bank of America report, which was at the RBC.

In order to overtake Japan and entrenched in the top three of the largest economies over the next ten years, India will need to demonstrate economic growth in 9% of GDP per year, indicate the bank analysts.

According to the authors of the report, enter the troika (after the United States and China) India will be able at the expense of three factors. First, analysts Bank of America note that the country began to receive the so-called demographic dividend. The number of dependents in the country is reduced, which can ensure the growth of real GDP by 6-7% and maintain the rate of accumulation at a level of at least 30% of the gross domestic product. The number of jobs is growing due to the development of the service sector.

Secondly, the increase in financial maturity will contribute to economic growth. But for this it is necessary to perform three conditions: expanding access to financial services, the emergence of new financial products and the development of the financial market.

Thirdly, the so-called “mass markets” appear in India. They implement the law of supply and demand, according to which the increase in consumer income leads to lower prices and the number of proposals. In other words, since the income of citizens grow, it will increase the demand and manufacturers will become easier to sell goods and services.