Population and Productivity

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With the world entering The Fourth Industrial Revolution, and becoming increasingly reliant on telecom and IT services, the size of your population and the level of productivity are the two metrics that are likely to matter more than any others, meaning that China and India are destined to become the two largest economies in the world. Economists and commentators will be carefully watching the changing mix of each country’s demographic profile and population numbers to predict how this will all play out.

It is therefore enlightening to see how much the populations of China and India have changed over the past 300 years, as is well illustrated in last week’s Visual Capitalist: “Today, China and India boast the largest populations, outpacing all others by a mile. The total populations of these two nations have been climbing for years, but India is moving at a faster clip. The big question is: When will India overtake China in population?”. After playing with the chart, it seems this will happen in 2026, when both countries are predicted to reach 1.46 billion.

“Another question this dramatic change begs is: at these rates of population change, can India’s GDP growth also surpass China’s in the next several decades? The short answer is likely a no, although both countries will still see immense GDP gains during this time. According to PwC, six of the seven largest economies in the world by 2050 will be today’s emerging markets – led by China and India in that order. While India isn’t likely to be the “next” China in terms of global GDP, it’s certainly giving it a fair fight as a potential rising superpower – and it all stems from the combined might of its growing population”.

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