NEW DELHI: Bangladesh is all set to overtake India in per capita gross domestic product (GDP) this year, according to the International Monetary Fund's (IMF's) latest World Economic Outlook (WEO) report.
India's per capita GDP is expected to decline by 10.5 per cent to USD 1,877 in 2020 while Bangladesh's per capita GDP is expected to rise by 4 per cent to USD 1,888. This projection is being seen as a major setback for the NDA government since the report states that five years ago, India’s per capita GDP was nearly 40 per cent higher than that of Bangladesh.
Added to this, since GDP figures are at current prices, India is likely to become the third poorest country in South Asia with only Pakistan and Nepal reporting lower per capita GDP. The report also states that the Indian economy will be the worst hit due to the Covid-19 pandemic in South Asia.
According to data available, Bangladesh’s per capita GDP grew at a CAGR of 9.1 per cent in the last five years, as against India's 3.2 per cent. Bangladesh's growth story comes on the back of booming export sector and a healthy growth in savings and investment rates.
However, IMF has predicted that India will recover faster than most of the nations, including Bangladesh, next year. In 2021, India’s per capita GDP is predicted to grow at 8.2 percent to USD 2,030, as against Bangladesh’s expected growth of 5.4 per cent to USD 1,990.
IMF’s WEO database also notes India’s economic contraction this year will be its worst since the 1990-91 economic crisis. IMF has forecasted India’s GDP to contract by 10.3 per cent in 2020-21.