Jefferies Predicts India to Surpass Japan and Germany, Becoming 3rd Largest Economy by 2027
According to the investment banking firm Jefferies, India is projected to reach a market size of nearly $10 trillion by 2030.
On Wednesday, Jefferies stated that India’s GDP is poised to reach $5 trillion within the next four years, positioning it to surpass Japan and Germany and emerge as the third-largest economy by 2027.
According to a statement, the investment banking firm asserted that India is on track to become a market approaching $10 trillion by 2030, emphasizing that it will be “inevitable” for major global investors to pay attention to the country.
Jefferies noted that India has transitioned from being the ninth-largest economy a decade ago to now ranking as the fifth-largest economy, boasting a nominal GDP of $3.4 trillion. When considering purchasing power parity (PPP), India’s GDP stands significantly higher at $13.2 trillion, positioning it as the third-largest economy globally.
The report highlighted that India’s GDP continued to expand despite the effects of various significant reforms, including the implementation of the bankruptcy law, GST, Real Estate Regulation Act (RERA), and demonetization.
It further mentioned that while these reforms were beneficial for the long-term outlook, they had a negative impact on short-term growth.
“India is forecasted not only to achieve a growth rate of 6% over the next five years but also to stand out in a global landscape where the growth rates of most major economies are anticipated to decrease.”
Jefferies stated their belief that India’s escalating growth performance, particularly compared to developed nations, will propel the country to swiftly ascend to the third position in the global GDP rankings before the decade concludes.
India’s Market Cap To Become $10 Trillion By 2030
Jefferies expressed its belief that Indian equity markets are poised to sustain returns of 8% to 10% in dollar terms over the next five to seven years.
“The company stated that structural domestic flows resulting from the shift of savings to equities and the potential listing of large unicorns in India could propel the market capitalization beyond $10 trillion by 2030.”
“It added that despite being the fifth-largest in terms of market capitalization, India ranks eighth in the Bloomberg World Index, with a weight of only 2.0%. In their perspective, this indicates significant potential for foreign investors to boost their investments in the world’s fastest-growing country.”
Jefferies stated that an increase in the country’s weight in a global fund could make Indian stocks essential for a broader range of equity investors.
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