New Delhi: According to a recent report by the global consultancy firm EY (EY), India can become the second largest economy in the world by 2038 on the basis of Purchasing Power Parity (PPP). The report stated that India’s GDP could reach $ 20.7 trillion by 2030, and by 2038 it is estimated to reach $ 34.2 trillion.

The report describes India’s youth population, high savings rate, and stable government loan-GDP ratio as major factors of its economic development. India’s middle age is 28.8 years in 2025, which gives it a young and efficient labor force. In addition, the government’s loan-to-GDP ratio is estimated to be reduced from 81.3% to 75.8% by 2030 in 2024.

The report also mentions that despite global trade pressures such as US 50% tariffs, India remains flexible due to its growing abilities in domestic demand and modern technologies.

According to the EY report, if India and the United States maintain an average growth rate of 6.5% and 2.1% respectively during 2028-2030, India can overtake the American economy on the basis of PPP by 2038.