India Outpaces Global Majors in Post-COVID Recovery; Set to Become World’s 3rd-Largest Economy

According to Furman's estimates, India's GDP will reach 10 percent by the third quarter of 2025, surpassing the pre-COVID real GDP trend. These factors are expected to make India the world's third-largest economy by the end of this year. US GDP will also grow during this period, but its growth will remain around 5 percent. Meanwhile, China and the Euro Area will remain well below trends, at minus 10 percent and minus 5 percent, respectively.

The main reasons for this are the crisis in China's property sector and the demographic slowdown, as well as the weakening of Europe's energy sector due to the Ukrainian war. In comparison, despite Western sanctions imposed following the Ukraine war, Russia's GDP remains on its pre-pandemic path. Although its pace has slowed, it remains positive and hovers around 1.1 percent.

The chart Furman presents based on his analysis of the data clearly shows that when the pandemic broke out in 2020, the global economy was severely impacted. However, even during this period, India's economy experienced a smaller decline than others, remaining between minus 5 and minus 10 percent. GDP in the Eurozone fell below minus 20 percent, while the US's was at minus 10 percent, and China and Russia also remained below zero.

According to Furman, India's progress after the pandemic is nothing short of miraculous. India not only restored the supply chain, which had collapsed due to the pandemic, but also handled the situation created by the lockdown and global crisis with remarkable efficiency. India strengthened digital infrastructure like UPI, increased spending on infrastructure like roads, strengthened information technology and pharma exports.