Indian Economy Likely To Cross $5 Trillion By 2025: Morgan Stanley

Indian economy is likely to cross the $5-trillion mark by 2025, owing to the improvement in macroeconomic indicators and reforms, according to a report by Morgan Stanley.

"In our base case, we expect a steady pace of implementation of policy reforms, which will lay the foundations for the country's real GDP growth to move higher to an average of 6.75% over the next 10 years," the research report said.

"If our projections were to come to fruition, the economy would pass the $5 trillion mark, a feat that has been achieved by only the US and China thus far, and would make India the fifth largest economy (from 10th currently) in the world," the report added.

The report also highlighted that the policy measures taken over the past 12 months had started playing their role in improving macro stability indicators.

"There is growing evidence that the market believes in a new growth cycle – the most pertinent signal being the widening gap between bond and equity yields," the report said.

According to the report, growth recovery will remain slow, but it is likely to pick up from the financial year 2016.

The report emphasised on economic reforms, saying the improvement in the external environment, along with an increase in the pace of structural reforms, would be the key factors for revival of growth.
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