Over the years, Bangladesh has accomplished in growing its exports, which leads to an increase in its GDP growth, and is now set to beat India, which had a significant lead over it a few years ago.
According to the IMF’s “World Economic Outlook” report released on Tuesday, India’s per capita GDP is set to plunge to $1,877 this fiscal year ending on March 31, 2021. The IMF’s previous prediction in June said output would shrink 4.5 percent. According to the IMF report, Bangladesh’s per capita GDP in dollar terms is expected to grow to $1,888.
India’s per capita GDP is expected to grow 8.2% in dollar terms at $2,030 in 2021, compared to an expected 5.4% growth of Bangladesh at $1,990.
Nepal and Bhutan are also expected to grow their economies this year, while the IMF has not yet divulged Pakistan’s data for 2020 and beyond.
The regression projection comes after India reported a contraction in its GDP for the June quarter at 23.9%, making India the worst performer among G20 economies. Last week, the RBI admitted that the economy would decrease by 9.5% in FY21, with minimal economic activity recovery in the March quarter.
What makes the situation even worse is that India’s per capita GDP was nearly 40% higher than Bangladesh’s till five years ago. During the past five years, Bangladesh’s per capita GDP has been increasing at a compound annual growth rate of 9.1%, compared with 3.2% growth reported by India during the same period.
Bangladesh’s GDP growth in the last few years had averaged around 8%, according to reports, at a time when the economic growth in the rest of the world was slowing down. HSBC Bank had already predicted that Bangladesh would be the 26th largest economy in the world by 2030.
However, India, Asia’s third-largest economy, is said to bounce back with an impressive 8.8 percent growth rate in 2021, thus regaining the position of the fastest-growing emerging economy, surpassing China’s projected growth rate of 8.2 percent, the IMF said.
Congress leader Rahul Gandhi, who has been serious about the economy’s state, hit out at the government after the IMF projections. He tweeted ‘a solid achievement of 6 years of BJP’s hate-filled cultural nationalism. Bangladesh set to overtake India’.