India Races Ahead In 2022

This story is part of Forbes’ coverage of India’s Richest 2022. See the full list here.

India has passed the U.K. to become the fifth-biggest economy behind the U.S., China, Japan and Germany. Bolstered by pent-up consumer demand, GDP growth is expected to hit 7% in the year ending March 2023, giving the country bragging rights as the fastest-growing major economy in the world.

It’s a big deal. Sustainable growth historically has eluded India’s stop-go economy. According to Morgan Stanley, the country is now heading toward its best run in over a decade. Credit growth in the industrial sector—a key metric for sustainable development—is picking up post-pandemic. Indian stocks rallied in the first quarter to lift their weighting in the MSCI Emerging Markets Index to the No. 2 spot.

Higher household costs, however, are causing concern. India’s retail inflation rose more than expected in August on soaring food and fuel prices. The government recently announced rice export restrictions—India is the world’s second-largest rice producer—to keep prices at home in check. Meanwhile, unemployment jumped to a 12-month high of 8.3% in August. Prime Minister Narendra Modi has pledged to make India a developed nation by 2047, a century after it declared independence. It’s on track to be a $35 trillion economy by then, and a global engine for growth.