India on Friday leapfrogged Great Britain to become the fifth largest economy in the world delivering a further blow to the London government.
UK fell behind in the final three months of 2021 to become the sixth largest economy. The calculation is based in US dollars, with India extending its lead in the first quarter, according to GDP figures from the International Monetary Fund (IMF).
The decline of UK down the international rankings is a grim viewing for the new prime minister of the country. Members of the conservative party had on Monday chosen the successor of Boris Johnson with Foreign Secretary Liz Truss expected to beat off competition from former Chancellor of the Exchequer Rishi Sunak in the run-in.
The winner is set to take over a nation witnessing the fastest inflation in around four decades and the risk of a looming recession that the Bank of England predicts, will last well into 2024.
In contrast, the economy of India is predicted to grow more than seven per cent this year. A world-beating rebound in the Indian stocks this quarter has just seen their weighting rise to the second spot in the MSCI Emerging Markets Index, trailing behind only China.
The size of the Indian economy in terms of nominal cash in the quarter through March was USD 8544.7 billion, while that of UK was USD 816 billion.
The calculations were done using the IMF database and historic exchange rates on the Bloomberg terminal.
The UK GDP has grown just one per cent in cash terms since in the second quarter and is likely to fallen further. After adjusting for inflation, it shrank 0.1 per cent.
The pound sterling has also performed well below its previous levels against the dollar as compared to the rupee, with the pound falling eight per cent against the Indian currency this year.
Meanwhile, the forecasts of IMF show India overtaking the UK in dollar terms on an annual basis this year, putting the Asian powerhouse behind only the United States, China, Japan and Germany.
It may be noted that India ranked 11th in the list of the largest economies in the world, with UK sitting in fifth.