According to Bloomberg news, the UK has lost its position as the world’s fifth largest economy to India amid high inflation and an energy crisis.

Data from the International Monetary Fund (IMF) shows that India has officially surpassed the UK in the last 3 months of 2021 to become the world’s 5th largest economy. India’s total GDP continued to lead in the first three months of 2022. As of March 2022, the nominal size of India’s economy reached $854.7 billion, higher than the UK’s $816 billion.

Thus, this is the second time that India has surpassed the UK in terms of economic scale. India’s money surpassed the UK for the first time in 2019.

India’s economy is forecast to be one-fifth larger than Britain’s by 2027

The Bank of England (BoE) report shows that the economy is facing the highest inflation in 40 years along with increasing crisis risks. According to the BoE’s warning, if economic crises occur, they will last until 2024.

In contrast, the Indian economy is forecast to grow by more than 7% this year.

According to the IMF, the Indian economy is expected to outstrip the UK in terms of dollar size this year. This is a big turning point when 10 years ago, India ranked 11th and the UK ranked 5th.

The IMF’s report is based on its own data as well as Bloomberg’s exchange data. Accordingly, the British economy in the second quarter also grew only 1% and if adjusted for inflation, the real figure was down 0.1%.

In the currency market, the British Pound also fared poorly against the Indian Rupee. Using the US dollar as a measure, the British pound has fallen 8% against the Indian Rupee so far this year.

Source: Bloomberg