By Admin 
The GDP of India’s neighbor China may be higher than that of India, but in many economic indicators India is now in a position to reach its level or get closer to it rapidly. According to a report by State Bank of India (SBI), by the end of this decade India will join the ‘upper-middle income’ category and will equal China and Indonesia in terms of per capita income. This report points to a major and historic change in India’s income structure.
India will match China in income
According to SBI, India’s per capita income can reach $ 4,000 in the next four years i.e. by 2030. This increase in India’s income is the result of a long and gradual process. After independence, it took about 60 years for India to transform from a low-income to a lower-middle income economy and this milestone was achieved in 2007. During this period, the average per capita income was only 90 dollars in 1962, whereas by 2007 it increased to 910 dollars, that is, an average increase of 5.3 percent was recorded annually.
After this, India’s economic pace increased. After independence, it took almost six decades for the country to become a trillion dollar economy, but by 2014, India became a two trillion dollar economy, by 2021 it would become three trillion dollars and then in just four years by 2025, it would become a four trillion dollar economy, leaving Britain behind. With this, India emerged as the fourth largest economy in the world. According to current estimates, India’s economy may touch the $5 trillion mark by 2027.
Increase in income year after year
The same trend has been seen on the per capita income front. By 2009, India’s per capita income reached $1,000 and in the next ten years, i.e. by 2019, it doubled to $2,000. It is estimated that by 2026 it will increase to $3,000, which will further strengthen the country’s consumption capacity and the size of the middle class.
In this background, rating agency Moody’s has also estimated India’s economic growth rate to be 7.3 percent in the current financial year. Moody’s believes that strong economic expansion will support average household income, which will have a direct impact on demand for sectors like insurance. According to the agency, rapid growth, increasing digitalization, tax reforms and proposed changes in government-owned insurance companies will lead to a sustained increase in insurance premiums, which is also likely to improve the profitability of the industry.