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India remains 3rd largest economy in purchasing power parity; still way behind China, US

The 2011 round of World Bank's International Comparison Program (ICP) had ranked India ahead of Japan and after the US and China

twitter-logoBusinessToday.In | June 23, 2020 | Updated 18:04 IST
India remains 3rd largest economy in purchasing power parity; still way behind China, US
India, was followed by Japan, Germany, and Russia

India has retained its position as the third-largest economy in the world in terms of purchasing power parity (PPP), even as it is way behind the US and China. India accounts for 6.7 per cent,  or $8,051 billion, out of the world's total of $119,547 billion of global Gross Domestic Product (GDP) in terms of PPP, a measure of relative consumer prices across countries, as against 16.4 per cent in case of China and 16.3 per cent for the United States, World Bank data for reference year 2017 show.

The 2011 round of World Bank's International Comparison Program (ICP) had ranked India ahead of Japan and after the US and China. China's GDP stood at $19,617 billion in PPP terms in 2017, while the United States' GDP was $19,519 billion. Together they accounted for one-third of global GDP.  India, was followed by Japan, Germany, and Russia.

"Overall, 19 economies contributed three-quarters of global GDP; three of these economies (India, Indonesia, and the Arab Republic of Egypt) were classified as lower-middle-income economies and six (China, the Russian Federation, Brazil, Mexico, Turkey, and the Islamic Republic of Iran) were classified as upper-middle-income economies, with the remainder classified as high-income economies. Together, they represented nearly 64 per cent of the global population," said the World Bank report for reference year 2017.

The PPP of Indian rupee per US dollar at GDP level is now 20.65 in 2017 as against 15.55 in 2011. The exchange rate of US dollar to Indian rupee is now 65.12 from 46.67 during the same period. Between 2011 and 2017, China and India moved up the ladder to occupy relatively higher positions in 2017 compared to other economies than they did in 2011, the World Bank noted.

Meanwhile, the global economy is expected to shrink the most since World War II this year owing to the coronavirus crisis, reducing incomes and sending millions of people into poverty in emerging and developing nations, the World Bank had recently said.

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