India, now the most populous country, is poised to challenge China’s title as the global growth engine by 2028. This shift is driven by significant economic potential and favorable growth forecasts.

Samir Kapadia, Founder & CEO of India Index, advocates for betting on India over the next decade. As the world’s fifth-largest economy, India is on track to surpass Japan and Germany, although catching up to China's GDP remains distant. Alexandra Hermann, lead economist at Oxford Economics, underscores the gap, noting China’s GDP is over four times larger than India’s.

Despite this, India is well-positioned to attract businesses shifting away from China. China recently beat growth estimates with a 5.3% increase in Q1 2024, but the IMF forecasts a decline to 4.6% for 2024 and 4.1% for 2025. Conversely, India’s growth is projected at 6.8% for 2024 and 6.5% for 2025, making it the fastest-growing economy, according to IMF Executive Director Krishnamurthy Subramanian.

The U.S. is increasingly considering India as a viable alternative to China, driven by tariffs and geopolitical tensions. Apple’s expansion in India, including opening stores and increasing iPhone production, exemplifies this trend.

However, India faces challenges, including a lagging labor force participation rate, particularly among women, and a reliance on agriculture. Significant foreign direct investment and multinational corporate involvement are crucial for India to upskill its workforce and expand its manufacturing sector.

Prime Minister Narendra Modi’s expected third term could further drive economic reforms. While India has seen strong reforms in the past decade, continued efforts to improve labor laws and reduce protectionist policies are necessary.

India’s potential is recognized globally, with investors seeing it as a compelling investment destination. However, competition from countries like Vietnam, which has made strides in electronics and manufacturing, remains a challenge.

In summary, while India’s path to becoming the global growth leader is filled with obstacles, its large consumer base, favorable growth forecasts, and increasing foreign interest position it as a strong contender to replace China in the coming years.

To read the entire article and Samir’s insights - Click Here 
Watch the complete SAN interview by clicking here - SAN Interview