- With a median age of just 38 years even in 2050, India’s population will grow by 15% to 1.6 billion, but the per capita income will accelerate by over 700% to approximately $16,000.
MUMBAI: India will start adding a trillion dollars to its gross domestic product or GDP every 12-18 months within the next decade, enabling it to become a $30 trillion economy by 2050 with a stock market capitalisation of $45 trillion, accounting for more than a fifth of global GDP based on purchasing power parity, said Gautam Adani, chairman, Adani Group, at the ICAI-hosted 21st World Congress of Accountants being held at the Jio World Convention Centre.
“Given the pace at which the Government has been executing a vast multitude of simultaneous social and economic reforms, I anticipate that within the next decade, India will start adding a trillion dollars to its GDP every 12 to 18 months – thereby putting us well on track to be a $30 trillion economy by 2050 and with a stock market capitalization that will possibly exceed 45 trillion dollars,” Adani said while addressing the theme ‘India’s Path to an Economic Superpower’ at the event.
Adani added that the United States today was a $23 trillion economy with a stock market capitalization ranging from $45 to $50 trillion.
While the absolute growth numbers would be more than for any other country between now and 2050, pairing purchasing power parity with GDP, he predicted that India’s share of global GDP would be north of 20% by the year 2050. This would happen against the current backdrop of several assumptions on a unipolar or bipolar world – like developed countries stepping into stabilising a global environment rocked by high inflation, rising interest rates and a Pandemic.
“The contours of international relations have fundamentally changed, and the aftertaste of globalization is not as flat as had been predicted.”
Adani added that in the emerging multipolar world, the country’s path towards becoming a high-income country was without compromising on its “democracy and diversity”. That three factors would aid India in its bid to become an economic superpower – demographic dividend, the pace of entrepreneurship enabled with digitalisation and the energy transition toward cooling the planet.
With a median age of just 38 years even in 2050, India’s population will grow by 15% to 1.6 billion, but the per capita income will accelerate by over 700% to approximately $16,000.
The growth of this consuming middle class will drive an unprecedented surge in demand which, in turn, will drive a surge in private and government expenditures as well as attract the highest levels of Foreign Direct Investment.”
“In this ongoing year, India is expected to record a 15% increase and an all-time high of over $100 billion of FDI. Such a scale of investments lay the foundation for significant job expansion. In fact, India’s FDI inflows have increased over 20-fold since the year 2000 and I would expect it to touch a trillion dollars by 2050. Nothing beats internal demand within a large economy to attract FDI and there could be no better sign of the increasing global confidence in India.”
Underscoring how digitalisation would drive the pace of entrepreneurship, Adani said that India added a unicorn every nine days last year and executed 48 real-time financial transactions globally, six times greater than the US, Canada, France, and Germany combined.
This has laid a base for the fourth industrial revolution where humans and machines are all interconnected.
“I expect that – just like India’s internal demand leading to a surge in FDI – the number of start-ups being created will lead to a surge in venture capital investments,” he told the audience. “VC funding in India first crossed one billion dollars in 2015. This year, VC funding will exceed $50 billion. That is a 50X acceleration in just 8 years. India stands as the foremost example of how a smartphone and inexpensive data – powered by aspirations – can create jobs and transform a nation.”
Lastly, energy transformation would be a lever for India’s growth. Energy poverty is today the developing world’s greatest challenge, and this gap will need to be mostly filled with renewable energy. While India currently ranks third in the renewable energy attractive index and is the world’s third-largest energy-consuming country, there is little doubt that India’s energy transition will be unparalleled as it races to meet its energy needs. By 2050, India will need 400% more units of energy than it currently consumes.
“While this may seem challenging, the technology advancements that we are seeing is expected to make this possible. Given the dramatic and continued drop in the cost of renewable energy, especially solar power, the marginal cost of green power is headed to ‘zero’. The ability of this ‘zero’ cost electron to economically split a water molecule and create 100% green hydrogen in the future is now certain. The combination of solar and wind power coupled with green hydrogen opens up unprecedented possibilities for India. I would go as far as to state that the revolution in alternative energy technologies opens up the possibility that, by 2050, India can become a net green-energy exporter.”
He said this was the reason that Adani Group was making a massive investment in driving – not just India’s – but the global energy transition. “Over the next decade, we will invest over $70 billion in this space and build the world’s most integrated renewable energy value chain.”
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