World Economic League Table (WELT)

World Economic League Table (WELT)

Subject :Economy

Context:

The Centre for Economics and Business Research (CEBR)- a UK-based economics consultancy, predicted that India will rise from fifth place in the World Economic League Table (WELT) in 2022 to third by 2037.

Details:

• Despite decelerating global demand and tightening monetary policy India is expected to grow in the fiscal year 2022-23 at 6.8%.
• The report noted that over the next five years, the annual rate of GDP growth is expected to average 6.4% and to average 6.5% in the subsequent nine years.
• India had an estimated PPP-adjusted GDP per capita of $8,293 in 2022-classifying it as a lower middle-income country.
  • PPP GDP is gross domestic product converted to international dollars using purchasing power parity rates.

Positive Prognosis:

• Rebound in economic activity led by a rise in domestic demand.
• The near-term growth outlook for the Indian economy is supported by domestic drivers i.e. low share of external sector around 20.1% to India’s GDP.
• Inflation in India had been lower than in most other large economies and mainly driven by food inflation- transitory in nature.
• The twin balance sheet problem looks to be on the mend with corporate debt-to-GDP at its lowest in nearly a decade and a half and low NPA.
• Reducing input cost pressures and rise in corporate sales.
• Rise  in investments in fixed assets
• The PLI scheme and capital expenditure schemes by government -Fresh investments are expected in renewables, electric vehicles, and battery tech.
• Bank credit has been growing in double digits for eight months now, reflecting in part an uptick in investment appetite.
• Term-lending to non-corporates is seeing an uptick — a positive sign that seems to imply that smaller firms may be seeking funds beyond their immediate working capital needs.
• The Centre had recorded robust collections in both direct taxes and GST, reflecting sustained recovery of the corporate sector
• States too have shown some decline in their consolidated deficits and net market borrowings.
• Agriculture has been a sustained driver for overall GDP growth.

Centre for Business and Economic Research (CBER)

• CBER was formerly called the Bureau of Business Research. It is an economic policy and forecasting research centre. The centre is headquartered in the UK.
• CBER research encompasses health care, regional economies, public finance, energy sector studies and transportation.
• The Cebr takes its base data from the IMF’s World Economic Outlook and uses an internal model to forecast growth, inflation and exchange rates.

WELT:

• Since its first publication in 2009, Cebr’s World Economic League Table (known as the WELT) has established itself as the go to measure of the comparative economic success of different countries.
• The WELT is calculated by estimating the current year GDP in current price dollars for each of over 190 world economies, and then forecasting real GDP, inflation and exchange rates for each country over the next 15 years.