India is likely to become third largest economy by 2029: SBI report

India is likely to become the third largest economy by 2029 -- up seven places since 2014 when the country was ranked 10th -- a State Bank of India report stated on Saturday. India is currently ranked fifth largest economy.

"The path taken by India since 2014 reveals the country is likely to get the tag of third largest economy by 2029," the report said.

The research report from SBI’s Economic Research Department highlighted that Gross Domestic Product (GDP) growth rate for FY23 is estimated between 6.7-7.7 per cent, but it is normal to have a 6-6.5 per cent growth due to global uncertainties.

According to a Bloomberg report on Friday, India had surpassed Britain to become the world’s fifth largest economy. India extended its lead in the first quarter, showed the GDP figures from the International Monetary Fund. But, as per the SBI report, India had surpassed the UK as the fifth largest economy as early as December 2021 itself.

"The share of India's GDP is now at 3.5 per cent, as against 2.6 per cent in 2014, and is likely to cross 4 per cent in 2027, which is the current share of Germany in global GDP," the report added.

The report also mentioned how Indian economy is likely to become the beneficiary as China slows down in terms of new investment intentions.

"Global tech major Apple's decision to shift part of its production of its flagship iPhone 14 for worldwide shipping from India, with a negligible time lag of a few weeks post its launch on September 7, bears testimony to such an optimism," it added.

However, in terms of GDP per capita, India still lags behind most economies in the world. As per World Bank data it had a GDP per capita of $2,277 in 2021, whereas the UK had a per capita income of $47,334. China's per capita income was nearly six times India's at $12,556 in 2021. 

On August 31, GDP numbers released by the National Statistical Office for the first quarter of FY23 had shown that the Indian economy grew 13.5 per cent. The GDP growth rate was lower than the 16.2 per cent forecast by the Reserve Bank of India's Monetary Policy Committee.

Indian economy had registered a GDP growth of 20.1 per cent in Q1FY22, owing to a low base.