Policy loosening risks stoking inflation - Capital Economics
India Economics

Policy loosening risks stoking inflation

India Economic Outlook
Written by Shilan Shah
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Policy support has been stepped up in recent months and, with further easing set to follow, growth should gradually recover from the slowdown in Q1. In fact, the risk now is that policy loosening goes too far, raising the prospect of higher inflation and interest rates beyond the next year or so.

  • Overview – Policy support has been stepped up in recent months and, with further easing set to follow, growth should gradually recover from the slowdown in Q1. In fact, the risk now is that policy loosening goes too far, raising the prospect of higher inflation and interest rates beyond the next year or so.
  • Output & Activity – Several activity indicators once again cast doubt over the accuracy of India’s GDP data. They also suggest that the investment slump has bottomed out, and that household consumption is holding up reasonably well.
  • External Sector – The current account deficit narrowed in Q1 and, barring a surge in oil prices – which we don’t expect – it should remain in check over the coming quarters. The quality of inflows that are financing the deficit is also set to improve if the Modi government pushes ahead with FDI reform in its second term.
  • Prices – Headline consumer price inflation has surprised to the downside in recent months. But we think it will soon threaten the RBI’s 4.0% target as food inflation continues to rise and underlying price pressures pick up following significant policy loosening.
  • Fiscal & Monetary Policy – The finance ministry is aiming to reduce the central budget deficit from 3.4% of GDP in FY18/19 to 3.3% of GDP in FY19/20. But this already looks doubtful. After two months, the deficit was already at over 50% of the amount budgeted for the whole year. What’s more, new Finance Minister Nirmala Sitharaman unveiled several expansionary measures in the union budget. Meanwhile, the RBI’s new governor Shaktikanta Das has proved amenable to the government’s wishes to keep policy loose. Rates have been cut by a cumulative 75bp this year, and further loosening is still likely.
  • Long-term Outlook – We expect India to sustain growth of 5-7% per year over the next two decades, making it the fastest-growing major economy in the world. As a result, its economy should more than triple in size and its share of world GDP should double.

Key Forecasts

Key India Forecasts

 

Quarterly

Annual

% y/y

(unless otherwise stated)

2019

2020

       

Q1

Q2e

Q3f

Q4f

Q1f

Q2f

2018

2019

2020

2021

 

                   

Output & Activity

                   

GDP

5.8

6.2

6.3

6.5

6.7

7.0

7.4

6.3

7.0

7.0

Household Consumption

7.2

7.2

7.4

7.4

7.5

7.5

8.5

7.3

7.5

7.8

Government Consumption

13.1

10.0

8.0

8.0

8.0

8.0

11.3

9.8

6.5

6.0

Investment

3.6

5.0

6.0

6.0

6.0

6.0

12.2

5.0

6.0

7.0

Exports

10.6

8.0

7.0

7.0

7.0

7.0

10.6

8.0

7.0

8.0

Imports

13.3

6.0

6.0

6.5

7.0

7.0

16.2

8.0

7.0

7.5

                     

External Sector (% of GDP)

                   

Current Account

-0.7

-1.5

-1.5

-1.7

-1.8

-2.0

-2.4

-1.3

-2.0

-2.5

                     

Prices

                   

Consumer Prices

2.5

3.1

3.6

3.7

3.8

4.1

4.0

3.2

4.0

4.5

Wholesale Prices

2.9

2.7

3.0

3.2

3.5

4.0

4.3

3.0

4.0

4.5

                     

Fiscal (% of GDP)

                   

Central Government Balance1

-3.4

-3.6

-3.4

-3.2

General Government Balance1

-7.3

-7.7

-7.5

-7.0

                     

Monetary (end period, %)

                   

Repo Rate

6.25

5.75

5.50

5.50

5.50

5.50

6.50

5.50

5.75

6.00

Reverse Repo Rate

6.00

5.50

5.25

5.25

5.25

5.25

6.25

5.25

5.50

5.75

Cash Reserve Ratio

4.00

4.00

4.00

4.00

4.00

4.00

4.00

4.00

4.00

4.00

                     

Markets (end period)

                   

Sensex Equity Index

38,672

39,395

37,200

35,000

35,950

36,900

36,068

35,000

38,750

44,500

5-yr Government Bond (%)

6.93

6.77

6.75

6.50

6.50

7.00

7.20

6.50

7.50

7.50

10-yr Government Bond (%)

7.35

6.90

6.75

6.50

6.50

7.00

7.40

6.50

7.50

8.00

INR/USD

69.2

68.9

72.0

73.0

73.0

73.5

69.7

73.0

75.0

76.0

                     

Gold ($/oz)

1,292

1,412

1,350

1,400

1,385

1,375

1,283

1,400

1,350

1,250

Brent Crude ($/pb)

68

67

63

60

62

64

54

60

65

68

Sources: Refinitiv, Bloomberg, Capital Economics; 1 Fiscal years (2018 = FY17/18)


Overview

Policy loosening risks stoking inflation

  • Policy support has been stepped up in recent months and, with further easing set to follow, growth should recover from the slowdown in Q1. In fact, the risk now is that policy loosening goes too far, raising the prospect of higher inflation and interest rates beyond the next year or so.
  • India’s much-maligned GDP data show that growth slipped to a five-year low in Q1. This probably overstates the extent of the slowdown, but there are areas of weakness. Export growth has slowed, and a sharp rebound seems unlikely given the softness of global demand.
  • Investment growth has also weakened amid a rise in funding costs for India’s non-bank financial companies following a large debt default last year. However, investment should recover a little as cuts to policy rates so far this year brings down funding costs.
  • Consumption should hold up reasonably well, underpinned by the introduction of a (partial) basic income scheme and subdued oil prices.
  • In all, the acute weakness of Q1 is unlikely to persist, but a sharp rebound also seems doubtful. We are forecasting growth of 6.3% this year, from 7.4% in 2018. (See Chart 1.)
  • The external position looks secure. In the near term, relatively lacklustre domestic demand will keep a lid on imports. Barring a surge in oil prices – which we don’t expect – this should keep the current account deficit in check. (See Chart 2.) And India’s low level of FX debt means that the further falls in the rupee we are expecting won’t have severe economic consequences.
  • Headline inflation also remains comfortable and below the RBI’s 4.0% target, due to weak food and fuel inflation as well as a drop in underlying price pressures. But with food inflation now accelerating, the headline rate is set to rise back above target. (See Chart 3.)
  • Nevertheless, policymakers are providing stimulus to support the economy. Despite ostensibly aiming to consolidate fiscal policy this year, the finance ministry unveiled several expansionary measures in the union budget. We think its budget deficit targets will eventually need relaxing. (See Chart 4.)
  • Meanwhile, the surprise resignation in June of one of the MPC’s most hawkish members, and the adoption of an explicitly more dovish policy stance, suggests that further monetary loosening is likely.
  • Our concern is that policy is being loosened too aggressively. The repo rate is already at its lowest since 2010 and, despite the recent slowdown, firms are reporting that capacity remains tight. (See Chart 5.) Hanging over all of this is the fear that the independence of the RBI is being eroded. We’ve made relatively sanguine assumptions (see Chart 6), but the risk is that inflation and interest rates will increase by more than we expect beyond the next 12 to 18 months.
  • This is a blot on an otherwise fairly upbeat long-run outlook. Prime Minister Modi’s BJP secured the largest Lok Sabha majority since the 1980s in this year’s general election. (See Chart 7.) That should lay the platform for continued gradual reform.
  • Measures to improve the business environment, ease FDI restrictions and boost infrastructure spending look most likely. The upshot is that long-term growth in India should remain above that of its emerging market peers. (See Chart 8.)

Overview Charts

Chart 1: GDP
(% y/y)

Chart 2: Current Account Balance
(% of GDP, 4Q Sum)

Chart 3: Consumer Prices (% y/y)

Chart 4: Fiscal Deficit (% of GDP)

Chart 5: Capacity Utilisation (Net % of Respondents)

Chart 6: RBI Policy Rates (%)

Chart 7: Lok Sabha Election Results
(% of Seats Won by Leading Party)

Chart 8: CE GDP Forecasts
(2018 – 2027)

 

Sources: Refinitiv, CEIC, Bloomberg, Capital Economics


Output & Activity

Activity to recover from Q1 weakness

  • The accuracy of India’s national accounts data has again been questioned in recent months, most notably by Arvind Subramanian – the former Chief Economic Advisor to the Modi government. The latest data suggest that GDP growth slowed to a five-year low of 5.8% y/y in Q1, from 6.6% y/y in Q4. This is hard to square with other indicators. For example, the OECD’s leading indicator for India, which aims to capture swings in the business cycle, remains at its highest in over seven years. (See Chart 9.)
  • According to the GDP data, investment was the biggest drag on growth in Q1. (See Chart 10.) This was most likely due to a combination of firms postponing investment decisions prior to the election and a rise in funding costs for India’s non-bank financial companies (NBFCs) following a large debt default last year.
  • However, the rise in production of capital goods in April and May suggests that the slump in investment has bottomed out. (See Chart 11.) And we expect a further, gradual recovery over the coming months. The emphatic election win for the BJP will have cleared some policy uncertainty, while the cumulative 75bp of policy rate cuts delivered by the RBI so far this year should help to bring down funding costs.
  • Meanwhile, household consumption should hold up reasonably well. Admittedly, the collapse in passenger vehicle sales over recent months looks alarming. (See Chart 12.) But a significant part of the drop in sales can be explained by industry-specific factors including changes to insurance laws pushing up costs and a drop in issuance of car loans from NBFCs.
  • Otherwise, consumption of smaller tickets items should hold up well over the coming months, underpinned by the introduction of a (limited) basic income scheme ahead of the general election. Consumers will also be the key beneficiary if oil prices stay around their current low level, as we expect.
  • Structural factors, including India’s youthful demographics and a low level of household debt (see Chart 13), provide further reasons to remain upbeat on the long-run prospects for private consumption.
  • The recent surge in government consumption growth – a result of a ramping up in spending ahead of the election – is unlikely to be sustained. But it is unlikely to be as much of a drag as we previously expected. Despite on paper attempting to rein in the fiscal deficit this year, the finance ministry unveiled several expansionary measures in the union budget.
  • Beyond domestic demand, we don’t think the economy will receive much external support over the next couple of years. The weakness of the rupee in trade-weighted terms since early 2018 has subsided more recently (see Chart 14), which at the margin will have harmed export prospects. More importantly, world trade has slowed sharply with little sign of an imminent rebound. (See Chart 15.) As such, a sharp rise in exports seems unlikely.
  • Bringing all of this together, we think the economy will grow by 6.3% this year, and rebound to 7.0% next year as policy stimulus takes effect. Our forecasts are below that expected by the IMF. (See Chart 16.) But even if our forecasts prove correct, India should remain one of the world’s fastest growing economies over the coming years.

Output & Activity Charts

Chart 9: OECD Composite Leading Indicator

Chart 10: GDP by Expenditure (% y/y)

Chart 11: Investment & Capital Good Production

Chart 12: Passenger Vehicle Sales (Units)

Chart 13: Household Debt
(% of GDP)

Chart 14: Nominal Trade-Weighted Exchange Rate
(Jan. 15 = 100)

Chart 15: Measures of World Trade Volumes
(% y/y, 3ma)

Chart 16: GDP
(% y/y)

 

Sources: CEIC, SIAM, Bloomberg, Capital Economics


External Sector

External position looks secure

  • The current account deficit narrowed in Q1 and we expect it to remain in check over the coming quarters.
  • Admittedly, export growth has been weak over recent months (see Chart 17), and the subdued outlook for global demand suggests that this won’t change any time soon.
  • But import growth is also unlikely to surge. For a start, lacklustre domestic demand will keep a lid on import volumes over the coming quarters, particularly of consumer goods.
  • What’s more, the value of key commodity imports will also remain subdued. Oil prices dropped sharply in May and early June. We think they will remain around their current level for the next 12 to 18 months as global demand remains soft. This will have a material impact on the import bill, given that oil accounts for around 25% of goods shipments into India.
  • A key concern for much of Asia is the rise in US protectionism, particularly given the political incentive for President Trump to ramp up trade protection ahead of the 2020 elections. However, India doesn’t look particularly exposed to a more protectionist US. Total merchandise exports from India to the US are equivalent to less than 2% of Indian GDP. (See Chart 18.)
  • The indirect impact through supply chain exposure to China, which has so far borne the brunt of greater US protectionism, is also very small. (See Chart 19.) This is an inadvertent positive stemming from India’s failure to develop a world-class manufacturing sector over the past few decades.
  • Finally, India is the largest recipient of overseas remittances in the world (see Chart 20), and we think inflows should remain fairly strong over the coming years – in part a reflection of the fact that newer technologies are helping to reduce the cost of sending money home.
  • Bringing all of this together, we expect the current account deficit to remain contained at around 1.5-2.5% of GDP over the next few quarters. (See Chart 21.)
  • What also matters is how the current account deficit will be financed. The latest data show that net foreign direct investment inflows – which tend to be the most stable and long-term source of funding – remained stable at the start of 2019, and significantly higher than volatile portfolio inflows. (See Chart 22.)
  • We are optimistic that FDI inflows will rise over the coming quarters. The easing of restrictions on FDI was one of the big successes for the Modi government in its first term, and we expect further reforms in this area during its second.
  • On the rupee, we expect weakness against the dollar over the next couple of years as slower global growth causes investors to retreat from riskier assets. We expect it to weaken to 73/$ by end-2019 and 75/$ by end-2020, from around 69/$ currently. (See Chart 23.)
  • There should be limited economic fallout from this. After all, the fall in trade-weighted terms will be mild, and India has a very low burden of FX debt, meaning that renewed currency weakness won’t exacerbate strains in the banking sector. (See Chart 24.)

External Sector Charts

Chart 17: Goods Exports ($USbn)

Chart 18: Goods Exports to US (% of GDP, 2018)

Chart 19: Origin of Value Added in China’s Exports to US (% of country’s GDP, 2017)

Chart 20: Remittances Inflows ($USbn)

Chart 21: Current Account Balance
(% of GDP, 4Q Sum)

Chart 22: Net Capital Inflows
(% of GDP, 4Q Sum)

Chart 23: Rupee vs $US

Chart 24: FX Debt (% of GDP, 2018)

 

Sources: Bloomberg, CEIC, Capital Economics, World Bank


Prices

Inflation risks lie on the upside

  • The rise in headline inflation so far this year has been primarily due to an acceleration in food price inflation. But with underlying price pressures also likely to pick up soon, it is only a matter of time before the headline rate rises above the RBI’s 4% target.
  • Predicting movements in headline CPI inflation is difficult given the volatile nature of fuel and food prices, and their large weighting in the consumer price basket. (See Chart 25.) However, high frequency price data can provide some indication over the near term.
  • Local fuel prices have become less sensitive to global oil prices in recent months as the government has made tweaks to excise duties. Most recently, duties were hiked in the budget but even so, transport inflation should remain relatively contained. (See Chart 26.)
  • Meanwhile, daily data suggest that vegetable price inflation may drop in the very near term but, on the (admittedly arbitrary) assumption that prices stay stable, vegetable inflation should rebound by Q3. (See Chart 27.) That would push up overall food inflation which, despite rising recently, still remains very low by historic standards. (See Chart 28.)
  • On balance, food prices are more likely to rise than fall over the coming months. Anecdotal evidence suggests that the late arrival to the monsoon this year has caused a drop in the sowing of the kharif crop, which will limit supply. Meanwhile, the recovery in natural gas prices (a key component of fertilisers) that we are expecting this year would push up input costs.
  • Beyond the volatile components, the recent slowdown in core inflation has challenged our view that underlying price pressures should be a key concern for the economy. But we think that core inflation will rise again over the coming months. For a start, despite weaker economic growth, soft surveys suggest that capacity utilisation is at its highest in several years. (See Chart 29.)
  • What’s more, monetary policy has already been loosened this year, with interest rates falling by a cumulative 75bp. Further easing is likely, given the RBI’s adoption of an explicitly more dovish policy stance. Meanwhile, despite attempting to demonstrate fiscal rectitude, the finance ministry announced several expansionary measures which we think will ultimately result in the fiscal deficit target being relaxed this year. The resulting boost to demand is likely to fuel underlying inflation.
  • Hanging over all this, there are concerns over the RBI’s independence. An erosion of the RBI’s credibility as an inflation fighter would lead to a partial reversal in the success that it has had in reining in price pressures since 2013. Inflation expectations have a reasonably good relationship with core inflation. (See Chart 30.)
  • Bringing all of this together, we expect inflation to average 3.2% in 2019, before rising to 4.0% in 2020. (See Chart 31.)
  • WPI inflation has been relatively stable in recent months. (See Chart 32.) If we are right in thinking that global oil prices will remain around their current levels, that will keep a lid on the headline rate in the near term (the index strips out the effect of taxes). But headline WPI will rise towards the end of the year as underlying price pressures build

Prices Charts

Chart 25: Consumer Price Basket
(%)

Chart 26: Weekly Fuel Prices and
Transport & Communications CPI (% y/y)

Chart 27: Weekly Vegetable Prices and
Vegetables CPI (% y/y)

Chart 28: Food CPI
(% y/y)

Chart 29: Capacity Utilisation (Net % of Respondents)

Chart 30: Actual and Expected Inflation (%)

Chart 31: Consumer Prices (% y/y)

Chart 32: Wholesale Prices (% y/y)

 

Sources: Refinitiv, CEIC, Dept of Consumer Affairs, RBI, CE


Fiscal & Monetary Policy

RBI set to cut rates further

  • The finance ministry is aiming to reduce the central budget deficit from 3.4% of GDP in FY18/19 to 3.3% of GDP in FY19/20. But this already looks doubtful. After two months, the deficit was at over 50% of the amount budgeted for the whole year. (See Chart 33.)
  • What’s more, new Finance Minister Nirmala Sitharaman unveiled several expansionary measures in the union budget. This included corporate tax exemptions and a bolstering of the bank recapitalisation package rolled out in 2017 by another INR700bn (0.3% of GDP).
  • However, the finance ministry appears to be planning little that might offset the impact on the budget. Instead, it is relying on bullish projections for revenue collections from the GST, even though revenues habitually fall short of target. (See Chart 34.)
  • Meanwhile, Ms Sitharaman has set the asset sales target for this year at a record INR1.0trn (0.4% of GDP). (See Chart 35.) Despite some recent success, this target is also often missed, and achieving this year’s goal is reliant on the smooth sale of Air India – the national carrier. This seems highly unlikely given that an initial deadline for companies to register an interest in buying Air India last year passed with no companies submitting proposals.
  • In all, we think the finance ministry will have no choice but to relax its deficit target – as has been the case in three of the past four fiscal years. A looser fiscal stance should provide some support to growth over the coming quarters, but it also means that debt levels won’t fall as fast as anticipated. We estimate that public debt will fall to 66% of GDP by 2023, compared to the IMF’s current forecast of a fall to 63% of GDP. (See Chart 36.)
  • On monetary policy, the Reserve Bank under the stewardship of Shaktikanta Das has trimmed interest rates by a cumulative 75bp so far this year. Further easing looks likely. After all, the central bank has switched its stance from “neutral” to “accommodative”.
  • And the recent surprise resignation of deputy governor Viral Acharya means that the MPC is likely to take on an even more dovish composition. After all, Dr Acharya and Dr Chetan Ghate were the only two dissenters when the committee trimmed rates in February and April this year.
  • We continue to think that further policy loosening would be a misstep. The repo rate is already as its lowest since 2010. Soft surveys show that spare capacity remains limited, while bank lending is growing at its fastest pace in five years. (See Chart 37.) Looser monetary conditions could also sow the seeds for another build up in the NPL ratio, which has only just started to drop. (See Chart 38.)
  • Hanging over all of this is the growing concern about the independence of the RBI. A perception that policy is being kept loose for the benefit of the government could lead to a rise in both inflation expectations and actual inflation. We think the RBI will have no choice but to raise interest rates by the end of next year. (See Chart 39.)
  • If we are right, it is likely that government bond yields will pick up over the coming quarters. We think the 10-yr yield could jump to 7.50% by the end of 2020, from around 6.60% currently. (See Chart 40.)

Fiscal & Monetary Policy Charts

Chart 33: Central Gov’t Fiscal Deficit

Chart 34: Central Gov’t Revenues from GST (INRbn)

Chart 35: Central Gov’t Asset Sales (INRbn)

Chart 36: Gross Government Debt (% of GDP)

Chart 37: Bank Lending to Private Sector

Chart 38: Non-Performing Loans (% of Total Loans)

Chart 39: RBI Policy Rates (%)

Chart 40: Government Bond Yields (%)

 

Sources: Controller General Accounts, RBI, Refinitiv, Capital Economics


Long-term Outlook

India to remain a global outperformer

  • We expect India to sustain growth of 5-7% per year over the next two decades, making it the fastest-growing major economy in the world. As a result, its economy should triple in size and its share of world GDP should almost double. (See Chart 41.)
  • Employment is likely to increase rapidly for two reasons. First, the expansion in the working-age population is set to continue. India will replace China as home to the world’s largest labour force by 2025. (See Chart 42.)
  • Second, female employment is likely to increase from its current very low levels. (See Chart 43.) India’s low female participation rate is often attributed to entrenched cultural norms. But we think it reflects a historic failure to implement labour market reforms and develop the strong manufacturing base that has often been the gateway for women in poor countries to enter formal employment.
  • Labour market reform will probably continue to be sluggish in the near term, but we are more optimistic about long-run prospects. Some of India’s more progressive states – such as Rajasthan – have been rolling out reforms to ease the process of hiring and firing workers and reduce trade union power. Such reforms should eventually spread to other states and influence policymaking by the central government.
  • Similarly, other productivity-boosting reforms should continue. Prime Minister Modi’s BJP secured the largest single-party majority in the Lok Sabha since the early 1980s in this year’s election, which should lay the platform for continued gradual reform. Further ahead, growing pressure from businesses and investors should ensure that politicians continue to make progress on reform regardless of who is in power.
  • Our optimism about long-run productivity prospects is underpinned by structural factors. India’s low per capita income means it has the potential to deepen its capital stock, shift the labour force from low to high productivity sectors, and replicate the best practices of richer economies. India should also benefit from high savings and investment rates.
  • Our forecasts would imply per capita GDP growth of around 4-5% per annum, which would leave India within the top 25% of performers in recent decades.
  • The combined central and state budget deficits will remain fairly high, but public debt is still likely to come down gradually as a share of GDP due to the economy’s rapid growth rate.
  • The broad trend is that inflation typically falls as emerging economies converge with advanced economies. Under the stewardship of Shaktikanta Das, the RBI appears less focussed on reining in inflation. But a complete reversal of the inflation-taming success of recent years is unlikely. And we suspect that the RBI will further reduce its inflation target over time, as central banks in many wealthier EMs have done.
  • India is likely to run a small but permanent current account deficit over the long term. After all, domestic investment is likely to remain higher than domestic savings given the government’s tendency to run a budget deficit.
  • The rupee will depreciate steadily against the dollar in nominal terms (see Chart 44) but the real exchange rate is likely to appreciate due to strong productivity gains.

Long-term Outlook Charts

Chart 41: Share of World GDP (%, PPP Exch. Rates)

Chart 42: Working Age Population (Millions)

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Chart 43: Female Labour Force Participation (%, 2018)

Chart 44: Rupee vs. US$

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Sources: UN, CEIC, Thomson Reuters, Bloomberg, Capital Economics

Key Forecasts (%y/y, Averages, unless otherwise stated)

 

2000-2007

2008-2012

2013-2017

2018-2022

2023-2027

2028-2037

Real GDP

7.1

6.4

6.7

6.8

6.2

5.5

Real consumption

5.5

7.7

6.9

7.5

6.0

5.0

Productivity

5.1

6.6

5.3

5.3

4.6

4.0

Employment

2.0

0.3

1.6

1.5

1.5

1.5

Inflation (%, year average)

4.9

9.7

6.1

4.2

4.0

2.8

Policy interest rate

(Repo rate, %, end of period)

7.8

8.0

6.0

6.5

7.0

7.0

Local currency 10-year gov’t bond yield

(%, end of period)

7.8

8.2

7.5

7.3

7.8

7.8

Government balance (% of GDP)

-8.6

-8.6

-7.0

-6.9

-6.0

-6.0

Government debt (% of GDP)

79.3

70.7

69.0

70.3

66.7

68.0

Current account (% of GDP)

-0.1

-5.1

-1.4

-2.0

-1.7

-1.7

Exchange rate

(Indian rupee per US dollar, end of period)

41.4

53.4

65.1

78.0

90.5

105.5

Equity market (Sensex, end of period)

20,287

19,426

34,056

46,000

59,305

140,240

Nominal GDP ($bn)

1,238

1,805

2,136

3,510

5,493

10,351

Population (mn)

1,116

1,230

1,309

1,383

1,451

1,538


Shilan Shah, Senior India Economist, +65 6595 1511, shilan.shah@capitaleconomics.com

Darren Aw, Asia Economist, +65 6595 5193, darren.aw@capitaleconomics.com

 

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