Goldman Sachs is predicting that after more than 15 years stuck in China’s slipstream, India could surpass China in the next two years in terms of real gross domestic product expansion.
A recent report from the American investment bank projects India’s real GDP growth rate will remain behind China’s this year and next but surpass it in 2016 with 6.8% GDP expansion as China’s growth slows to 6.7%. The growth optimism comes just days after Transparency International’s annual ranking of least-corrupt countries placed India above China for the first time in 18 years.
In terms of growth, Goldman predicts that India will have one of the highest growth rates in the world in 2016 with more than triple the growth rates of Brazil, Russia, Japan or Europe.
“The new government has focused on boosting potential growth and removing bottlenecks on the growth path,” Goldman said in a December 1 report. “The first six months (of the new administration) has already seen a move towards kick-starting the investment cycle, and we think reforms to boost investments can continue.”
In the New York Times, Jim O’Neill, the economist who bound Brazil to Russia, India and China to form the BRIC investing strategy, opined that he was confident that India’s economy had a really good chance of becoming the world’s third-largest before 2040. “The country has exceptionally favorable demographics, and in electing Prime Minister Narendra Modi, India has given itself the best chance in at least 30 years of being run by a government that is not smothered by its democracy but flourishes instead. The stock market has taken note, and I would expect a continued positive repricing of Indian investments,” states O’Neill.
Last updated: December 26th, 2025
