Latest news with #PurchasingPowerParity
Time of India
3 days ago
- Business
- Time of India
India GDP data Q4 FY25 Live updates: Indian economy to retain 'fastest growing' tag; GDP growth to pick up in fourth quarter
14:30 (IST) May 30 The size of India's economy measured in Purchasing Power Parity (PPP) reaches $15 trillion, exceeding half of the US economy's value, according to NITI Aayog Vice-Chairman Suman Bery. Whilst India's nominal GDP at market prices amounts to $4 trillion, the PPP measurement demonstrates a substantially larger economic value of $15 trillion. The comparison shows that India's PPP-adjusted economy of $15 trillion measures against the United States' $29 trillion, demonstrating that the Indian economy's scale is roughly half of America's economic strength. The PPP metric calculates the quantity of currency units required to obtain an identical basket of goods and services that can be purchased with one unit of the reference country's currency.
News18
3 days ago
- Business
- News18
India's Economy Set For Strong FY26 Growth With Push In Global Economic Standing
Last Updated: India's economy in Purchasing Power Parity terms now stands at $15 trillion—more than half the size of the United States economy India's economy is poised for robust growth in the financial year 2025–26, with the Reserve Bank of India (RBI) projecting a real GDP expansion of 6.7 per cent. Backed by solid domestic demand, high capital expenditure, and improved agricultural prospects, the country continues to cement its position as one of the world's fastest-growing major economies. According to a report published in The Hindu Business Line, the RBI's quarterly GDP growth forecasts for FY26 stand at 6.7 per cent for Q1, 7.0 per cent for Q2, and 6.5 per cent each for Q3 and Q4. The central bank attributes this optimism to strong Rabi crop output, healthy reservoir levels, and a continuing recovery in manufacturing and services. The inflation outlook is also improving. CPI inflation is projected to average 4.8 per cent in FY25, with a further decline to 4.2 per cent anticipated in FY26. This moderation is expected due to easing food prices and effective monetary policy actions, helping maintain consumer purchasing power and support macroeconomic stability. A key contributor to this positive outlook is the rebound in household financial savings, which had declined in previous years. A Business Standard report notes that these savings have started to improve, reflecting increased disposable incomes and more prudent financial behaviour among Indian households. This resurgence in savings is likely to support consumption-led growth and provide a buffer against future economic shocks. On the global stage, India's economic footprint continues to grow. As highlighted by NITI Aayog Vice-Chairman Suman Bery, India's economy in Purchasing Power Parity (PPP) terms now stands at $15 trillion—more than half the size of the United States economy. 'This is a remarkable indicator of the real economic weight India holds globally," Bery was quoted as saying. This confidence in India's growth trajectory was shared by Chief Economic Adviser V Anantha Nageswaran at the Confederation of Indian Industry's (CII) Annual Business Summit. Speaking to Mint, he emphasised that India's growth continues to be broad-based and supported by structural reforms and resilient macroeconomic fundamentals. Nageswaran advised Indian industry to be prepared to deal with a stronger currency in the coming years by becoming more competitive through productivity improvements. From rising household savings to growing global stature and strong FDI flows, India's economic momentum appears not only sustained but also accelerating. With supportive fiscal policies, robust agricultural performance, and growing investor interest, FY26 could mark another milestone in India's journey toward becoming a global economic powerhouse. Watch India Pakistan Breaking News on CNN News18. Stay updated with all the latest business news, including market trends, stock updates, tax, IPO, banking finance, real estate, savings and investments. Get in-depth analysis, expert opinions, and real-time updates—only on News18. Also Download the News18 App to stay updated! First Published:
India.com
5 days ago
- Business
- India.com
Richest countries in the world in 2025 by GDP per capita, US and India's position will surprise you, check which country is at top spot
Richest countries in the world in 2025 by GDP per capita, US and India's position will surprise you, check which country is at top spot Imagine living in a country where people worry more about which private island to visit next than about paying their electricity bills. While many of us are thinking twice before ordering food delivery, there are places where folks casually plan luxury holidays or buy designer watches without blinking an eye. In this article, we will look at the world's richest countries, not by how big they are but by how much money the average person has. The rankings are based on numbers from the International Monetary Fund (IMF), and if you're expecting big countries like China or the US to lead the list, you might be surprised to see that some of the smallest countries actually top the list. How the these rankings are decided GDP stands for the total amount of goods and services a country produces. When we divide that by the number of people living there, we get an idea of how wealthy each person might be. But to make this more accurate, experts also look at how much things cost in each country and how inflation affects prices. That's where Purchasing Power Parity (PPP) comes in, it gives a better comparison of how far your money goes in different countries. While this method is not totally perfect (especially because some countries are tax havens that show higher GDPs due to outside money), it's still one of the best ways to compare how rich or poor countries really are. 1. Singapore Singapore takes the number one spot with each person, on average, making about USD 156,760 a year. The country's economy grows at around 2 per cent every year. Once a small port, Singapore is now a global business and trade center. Big companies and rich individuals from around the world are drawn to Singapore. It's also known for its advanced banks and industries like electronics and medicine. 2. Luxembourg Luxembourg comes in second, with an average income of USD 152,920 per person and an annual growth of 1.6 per cent. This tiny country in Europe has made a name for itself in banking, steel, and finance. It's also home to several important European Union offices. Over 4,000 investment funds are based here, and many global companies use Luxembourg as a base to do business in Europe. 3. Macao (SAR of China) Macao ranks third with an average yearly income of USD 134,040 and a 3.6 per cent yearly growth. This small region near China is best known for its casinos and tourism. In fact, it earns more money from gambling than Las Vegas. Tourists, especially from China and other Asian countries, visit Macao in large numbers, helping boost its economy. 4. Ireland Ireland has an average income of about USD 134,000 per person and is growing at 2.3 per cent a year. A big reason for this is its low business tax of 12.5 per cent, which attracts large global companies. Famous tech firms like Google, Facebook, and Apple have set up their European offices here. 5. Qatar Qatar earns around USD 121,610 per person each year, with a growth rate of 2.4 per cent. This country is rich in oil and natural gas, holding the third-largest natural gas reserves in the world. Qatar has used its energy wealth to improve other parts of its economy, such as education, technology, and buildings. Its national savings, through one of the world's biggest investment funds, are spread across real estate, sports, and tech around the globe. The country is also becoming known as a center for global events and business. 6. Norway Norway's average income is USD 107,890 per person, growing at 2.1 per cent annually. The country earns a lot from oil found in the North Sea, but it also uses this money wisely. It created a fund, the biggest in the world, to save and invest its oil earnings. Norway's economy is not just about oil. It also focuses on shipping, making advanced products, and clean energy, making it a well-balanced and smartly managed economy. 7. Switzerland People in Switzerland earn about USD 97,580 per year on average, though the country's economy is growing slowly at 0.9 per cent. Switzerland is known around the world for its strong and trustworthy banks, luxury watches, and high-quality medicine. Its banks are famous for keeping clients' money safe and private. The country also makes precision tools and machines, and its medicine industry includes big companies like Novartis and Roche. 8. Brunei Brunei's average income is around USD 95,760 per person, with 2.5 per cent yearly growth. This small country in Southeast Asia has made most of its money from oil and gas. Thanks to this wealth, the government gives people free healthcare and education. Now, Brunei is trying to grow in other areas like halal food, Islamic banking, and nature tourism. 9. Guyana Guyana has seen a big change and now has an average income of USD 94,260, with the fastest growth on the list at 10.3 per cent! This South American country recently found large oil fields, and big companies like ExxonMobil have started major projects there. Besides oil, Guyana also has gold, diamonds, and bauxite. 10. United States In the U.S., the average income per person is USD 89,110, with a growth rate of 1.8 per cent. Even though it's 10th on this list by income per person, the US is is still the richest country in the world by total money made. Its economy is huge and covers many areas like tech, farming, movies, banking, and manufacturing. The US. is home to famous tech hubs like Silicon Valley and has the most powerful financial center, Wall Street. The U.S. dollar being the main currency used worldwide also helps its economy stay strong. India's position India ranks 124th with a GDP per capita of 11,940 dollars in 2025. While India is the world's fifth-largest economy, its GDP per capita is significantly lower compared to the wealthiest nations. Despite this, India continues to grow rapidly, largely due to its service and technology sectors.
Time of India
6 days ago
- Business
- Time of India
India's economy may overtake Japan soon, but with caveats
India is set to become the world's fourth-largest economy by the end of 2025 (FY 2025-26), according to the International Monetary Fund's (IMF) World Economic Outlook (WEO) report released in April. A few years ago, India overtook the United Kingdom to become the fifth largest, and is now well on its way to rise to the fourth spot in the list of the top 10 largest economies in the world by overtaking Japan. In just 11 years, India has surged from the world's 10th to the 4th largest economy — a remarkable trajectory driven by sustained growth and strategic reforms under the NDA government. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like 이미지로 기억하면 영어가 쉬워진다! 40분 특강 무료 공개 스티븐영어 지금 시작하기 Undo ALSO READ: India to become 4th largest economy by end of 2025: NITI Member Arvind Virmani India's growth numbers have triggered premature celebrations, as there is more to it than meets the eye. Live Events India is set to become the world's fourth-largest economy this year, but with the world's largest population, its per capita GDP remains strikingly low at just $2,880, according to the IMF — far behind China's $13,690 and Japan's $33,960. Gross Domestic Product (GDP) per capita is a key economic indicator that measures the average economic output (or income) per person in a country. Economists use GDP per capita to determine the prosperity of countries based on their economic growth. India doesn't even rank in the top 100 countries when it comes to GDP per capita, not even in the Purchasing Power Parity or PPP rankings. A large population (1.4 billion) dilutes the gains of the GDP doubling. Also, informal employment ( approximately 90% of workforce) and low female workforce participation (26% vs. global 47%) limit per capita gains, says Sachchidanand Shukla. Still, the per capita income has close to doubled over the last 10 years. 'That is keeping pace with the overall GDP growth as the population growth is slowing down with fertility rates going close to the replacement rate of 2.2. However, there are regional disparities owing to differential population growth rates as well as the pace of economic development,' says Ranen Banerjee. The brighter picture in 5 points: In 2025, India will become the 4th largest economy in the world, in nominal GDP terms, overtaking Japan, and will be behind only the US, China, and Germany. India's nominal GDP has more than doubled from 2014 to 2025 (projected). It's a growth of 105% in just a decade. In 2025, India will also become a $4 trillion economy. India was the 10th largest world economy in 2014 - come 2025 it will be the 4th largest - a six places jump in rankings in just 11 years. In a world of increasing global economic uncertainties, and amidst geopolitical conflicts and Donald Trump's tariffs, India will still retain the tag of being the fastest growing major world economy with a GDP growth rate of 6.2% for 2025. India achieved an average annual growth rate of 6.7% from 1990–2023 & in fact outpaced the US (3.8%), Germany (3.9%), and Japan (2.8%). What lies ahead? India will realise its dream of becoming a $5 trillion economy in 2027 and the world's third largest in 2028 by overtaking Germany. But to be on the path of stable and sustained economic growth, experts stress on the need for continuous reforms. PwC's Ranen Banerjee advocates for reforms that enable private enterprise to do business without the fear by decriminalising regulatory compliances with application of technology to support in compliances. 'Enabling exports through common facilities for quality outputs by MSMEs and continued investment in infrastructure to bring down logistics cost and enhance evacuation capabilities will be needed,' he adds. L&T's Shukla says, 'Going forward India will need to undertake deep agricultural reforms, labour reforms, education & skilling at a scale along with judicial administrative & police reforms,' he says. Radhika Rao of DBS Bank sees the need to focus on employment generation. 'Wheels of the structural engine will require to be oiled by keeping the development and reform agenda on track. Quality of growth is also likely to improve as macro balances remain in check alongside a changing trade composition. Lifting employment generation and by extension boosting incomes will be the vital objective for the administration in the rest of its term,' she says. There's no question that India ranks as one of the most crucial markets worldwide, including for major powers like the US and China. Over the past 11 years, political stability at the central government and ongoing reforms have strengthened global investor confidence. However, for the benefits of this growth to reach the broader population, it's essential to focus on creating ample employment opportunities for young people and building a robust manufacturing sector to ensure sustained, stable, and dependable economic progress. (With TOI inputs)
Daily Maverick
21-05-2025
- Business
- Daily Maverick
Back to Economics 101: The US economy and the functions of money
Part 3 in a five-part series. Read Part 1 here, and Part 2 here. It has only recently become clearer as to what probably happened to America in the period since the Gold Standard was suspended in the early 1970s and fiat money came to rule global finance. At the risk of being academic, the unleashing of global capital flows from the 1970s fragmented the functions of money as embodied in the US dollar. In 1875, economist William Stanley Jevons expounded his four functions of money, encapsulated in the 1919 rhyme, 'Money's a matter of functions four, A Medium, a Measure, a Standard, a Store.' Of these four money functions, the two most important are money as a Medium of exchange and money as a Store of value. Money as a Measure is a metric like centimetre, litre or kilogramme: we use it for counting. Money as a Standard of deferred payment deals with the financial denomination of debt to be settled in the future, a function some modern economists subsume within the money as a store of value function. What happened after the Nixon Shock for the US dollar was that the 'medium' and 'store' functions — and more importantly the underlying values they represented — started to diverge. At the risk of overgeneralising, the US dollar's medium of exchange function became more related to trade transactions, while the US dollar's store of value function became more related to capital transactions. The value of money breathes two atmospheres A world of two financial atmospheres began to emerge: an Atmosphere of Capital centred squarely on the US, and the Atmosphere of Trade whose centre of gravity began migrating towards Asia and, in particular, China. The end result today, as Gillian Tett noted in the Financial Times: 'America (has) hegemonic power in finance, via the dollar-based system… China has hegemonic power over global manufacturing, via its dominance of supply chains.' Yes, the 'measure of money' of both these two atmospheres was and is mostly still in US dollars — trade is still overwhelmingly invoiced in US dollars — but the intrinsic value they reflected started to diverge. Today the Atmosphere of Trade largely determines movements on a nation's current account and its value is more akin to (though not precisely measured by) Purchasing Power Parity (PPP). The Atmosphere of Capital is the one with which global financial markets are most familiar: value is reflected by 'free market' exchange rates. The latter's net flows show up mostly on a nation's capital account. Thus, the valuations of each of these two functions of the US dollar — were they able to be separated — would be very different. Bloombergia and CNBC-land think mostly in terms of market values: yet most Chinese exporters effectively invoice (even if most do not realise it) in PPP dollars. China's current GDP — dominated as it is by trade flows reinforced by a closed capital account — is at market rates of about $18-trillion to the US' $30-trillion. But at PPP rates, China's GDP is rather closer to $40-trillion again to the US's $30-trillion. American politicians wearing trade-oriented glasses see China's currency as fundamentally undervalued, its free-market value manipulated lower by the Bank of China. But few have noticed that were a revaluation of the Chinese renminbi to occur (so triggering a relative devaluation of the US dollar to realign cross rates more closely to PPP values), China's economy could become quite a bit larger than the US economy. China wanted 'competitive' renminbi, US wanted 'strong' dollar Even as the exchange rate management behaviour of the Bank of China has been (and still is) aimed at keeping the value of China's renminbi lower than its 'free market' value, thereby allowing China to continue enlarging its global trade footprint, vested interests representing big capital in the US have long had a complementary yet opposite agenda: both US public and US private sector actors mostly wanted to keep the value of the US dollar higher (the 'Strong Dollar Policy') despite the pleadings of US industry (and US agriculture) for a more competitive exchange rate. Even the US Treasury long favoured a strong dollar… until now. Under Donald Trump, this era is over. In the words of US Treasury Secretary Scott Bessent, the US will now put Main Street before Wall Street, thus ending a multi-decade practice where the US capital tail has been wagging the US trade dog. Though not expressed as such, the Trump Administration is trying to narrow the difference of the store of value and medium of exchange rates of the US dollar, bringing its 'capital' value down to a rate closer to what they perceive the 'trade' value of the US dollar should be. The hope is that this will reverse the hollowing out of US industry and — to paraphrase Trump — make US manufacturing great again. How the US economy got tied up in today's Gordian knot In 1959, the Netherlands discovered natural gas in the North Sea. Over the next two decades, gas grew to have an outsized influence on Dutch exports and in the process drove up the value of the Dutch guilder. Most low-value-added manufacturing in the Netherlands simply could not compete at the higher exchange rate, and much of Dutch industry was hollowed out. Thus was born the economic term 'Dutch Disease'. Since then, commodity exporters worldwide have been wary of the fallout that would probably result from a commodity price bonanza that would increase the value of their currency and so in turn boost their terms of trade. When this appreciation was allowed to happen, export-oriented domestic manufacturing industries invariably suffered… and rarely recovered in the aftermath, even when and if commodity prices settled lower again, bringing the exchange rate down as well. Manufacturing export markets once lost were hard to recover. The US has, since the 1970s, experienced its own form of Dutch Disease, albeit driven by a unique 'commodity': the attractiveness of its currency, its capital markets and most especially its government bond market, offering as the latter did a store of value with very little downside currency risk. This was highlighted by Brendan Greeley in a 2019 Financial Times opinion titled 'How to diagnose your own Dutch Disease'. Greeley noted that 'around 1980 the United States discovered that it was the Saudi Arabia of money'. This non-resource 'commodity' supercharged the post-1980 financialisation of the American economy, particularly since the Global Financial Crisis. Since the valuation lows of 2008/2009, the St Louis Fed's broad-based value of the US dollar has risen over 46%. Already 'infected', the US contracted a 'double case' of Dutch Disease, further laying waste what remained of its industrial manufacturing infrastructure. Result? From 2020 to 2024, none of the top 10 industrial export sectors — five of which were energy-related — achieved revenue growth above inflation. [Parenthetically, in 2008 the Shale Revolution began in the US. It has since turned the US from being a net importer of oil and gas (2008: $452-billion) to being a big net exporter (2024: $176-billion). As happened in the Netherlands, carbon played its part in the post-GFC intensification of the US's Dutch Disease. But the true underlying cause of the affliction has been the 'export' of that most unusual of 'commodities': the US Treasury Bill.] What is left of US industry today? Of the top 20 industrial plants by employment in the US today, 11 are in defence and aerospace, four are in autos (of which two are Tesla), four in tech and one in pharma. Given the defence bias of this list, this is hardly what one might call a world-class, globally competitive, broad-based industrial foundation for a modern United States. Economists' defence: US consumers won more than US producers lost Many economists have dismissed the negative consequences of this seismic shift, reasoning the gains to US consumers far outweighed the losses to US producers. Hard evidence to support this cost-benefit analysis however has been sketchy, particularly because the losses to employment — not just the economic ones but the social ones as well — are hard to measure. Besides, many of those gains were in effect only secured by running up the US' national debt, owed to both domestic and foreign investors. Stock and bond market-oriented economists further rationalised the fallout with the offsetting gains from product price deflation (from cheaper imports) and even more so from the gains in stock prices — $10,000 invested in an S&P 500 index fund in 1992 would have risen to $270,000 at the end of 2024: 27 times growth in 33 years, a 10% compound annual growth rate. Bond prices performed well too, rising strongly from 1981 to 2020: over this four-decade period, bond yields fell from just under 16% to just over 2%. Contrast this gain to what happened to GDP: over the same period, it rose from $6.5-trillion to $29.7-trillion: only 4.6 times or a compound annual growth rate of 4.7%. Given these stock and bond market gains, what's not to like? For the captains of capital (including the tech-oriented companies who displaced the industrial titans of 1980 when the top 10 were composed of six oil companies, two car assemblers, GE and the 'old' IBM), capital gains from the stock market have resulted in a massive wealth windfall to both management and shareholders. Federal debt and wealth inequality The undersides to these halcyon days were many, but two need highlighting. Firstly, federal debt rose almost twice as fast as GDP, from $918-billion in 1980 to near $37-trillion today, a compound annual growth rate of 8.6%. Much of this debt went into funding defence, social security and Medicare/Medicaid with — in today's ageing US — an ever-larger share also going into pensions. Expenditure growth (favoured more by Democratic than Republican administrations, unless it was on defence) coupled with tax cuts (often favouring the rich, mostly sponsored by Republican administrations) naturally increased deficits, which thereby rolled into higher aggregate federal debt. With interest rates falling, the carried-forward overall debt resulted in a bearable debt interest burden: in Dick Cheney's words, ' deficits didn't matter '. But not when in 2022 the Fed Fund's rate began rising again: the burden grew quickly to be $881-billion in 2024. (This interest bill was capitalised and added to the outstanding federal debt load.) In 2024, this $881-billion payment overtook the US defence budget for the first time, breaching Niall Ferguson's Law: 'Any great power that spends more on interest payments on the national debt than on defence will not stay great for very long.' (It should also be noted that the US government's off-balance sheet liabilities now top $80-trillion. Entitlement programmes are rapidly approaching bankruptcy: Medicare is forecast to go under before Trump leaves office, Social Security during the tenure of his successor.) Secondly, US wealth inequality has widened, especially benefitting the ultra-rich. In 1980, the top 1% owned 24% of US wealth, the next 9% owned 44% and the bottom 50% only 2.5%. By 2024, the top 1% owned 31% of US wealth, the next 9% owned 36% and the bottom 50% still only 2.4%. The social and political implications of this concentration of wealth at the top and dearth of wealth for the 'Left Behinds' and 'Never Caught Ups' at the bottom needs little elaboration. Suffice it to say, the latter fuelled the rise of the Steve Bannon/MAGA wing of today's Republican Party. DM
