India likely to surpass UK in largest economy rankings of 2019: PwC report

NEW DELHI: India and France are likely to surpass the UK in the 2019 rankings of world's largest economies, according to the latest projections by British consultancy multinational PwC.

PwC's annual Global Economy Watch projects real GDP growth in 2019 of 7.6 percent for India, 1.6 per cent for the UK and 1.7 per cent for France.

"India and France are likely to surpass the UK in the world's largest economy rankings in 2019, knocking it from fifth to seventh place in the global table," the report said.

"India is the fastest growing large economy in the world, with an enormous population, favourable demographics and high catch-up potential due to low initial GDP per head. It is therefore all but certain to continue to rise in the global GDP league table in the coming decades." 

The report noted that while Britain and France have regularly switched places owing to similar levels of development and roughly equal populations, India's climb in the rankings is likely to be permanent.

"India should return to a healthy growth rate of 7.6 per cent in 2019-20 if there are no major headwinds in the global economy such as enhanced trade tensions or supply-side shocks in oil," it said. 

According to PwC, the global economy is expected to slow in 2019 as G7 countries return to long-run average growth rates, 

"The global economy enjoyed a mini-boom between the end of 2016 and early 2018, when growth picked up in most major economies. This phase is now over, and in 2019 we expect the G7 economies to return to growth rates close to their long-run averages," the report said. 

The US was the world's largest economy in 2017 with a size of $19.39 trillion, followed by China at $12.23 trillion, Japan ($4.87 trillion) and Germany ($3.67 trillion).

The report also said that global trade conflicts will deepen. 

"We expect trade wars to continue in 2019. This is likely to generate further uncertainty for policymakers and businesses," it said. 

"The main focus of tensions is likely to remain US-China trade, but there will always be the risk of this escalating into a wider trade conflict and businesses accordingly need to plan for different scenarios," it added.