India now 3rd largest economy, China to become 1st

The world’s leading statistical agencies revealed on Wednesday that China is set to overtake the United States of America as the world’s number one economy, and that India has trumped Japan, securing the place of the world’s third largest economy. Rapid growth and development in China has led economists to anticipate that China, currently the second largest economy, would move into the number one position over the next few years.

By assessing the purchasing power parity (PPP), which is an estimate of real living costs, the 2011 International Comparison Program (ICP), which involves the World Bank, revealed that the global economy is going to be very different from their last update in 2005. The research puts China’s gross domestic product (GDP) at 87% of the US in 2011, and says the Chinese and Indian economies have more than doubled relative to that of the US. The 2005 study stated that China’s economy was less than half the size of the US, at 43%.

"The United States remained the world's largest economy, but it was closely followed by China when measured using PPPs. India was now the world's third largest economy, moving ahead of Japan," the report stated.

The findings of the ICP have sparked debates over whether that China is likely to overcome US sooner or later than predicted. The Financial Times used the ICP figures to predict that China could overtake the US as the world’s economy this year, which is five years earlier than the projected forecast.

The 2011 report lists the world’s 10 biggest economies in the following order: US, China, India, Japan, Germany, Russia, Brazil, France, the UK, and Indonesia.