NEW DELHI: India may take practically 75 years simply to obtain one-fourth of US income per capita, as per a current World Bank report that gives the primary intensive blueprint for growing nations to overcome the “middle-income trap.”
More than 100 nations, together with India, China, Brazil, and South Africa face critical challenges in changing into high-income nations within the subsequent few many years, the report stated.
According to the World Development Report 2024: The Middle Income Trap, “At current trends, it will take China more than 10 years just to reach one-quarter of US income per capita, Indonesia nearly 70 years, and India 75 years.”
“Drawing on lessons of the past 50 years, the study finds that as countries grow wealthier, they usually hit a “trap” at about 10% of annual US GDP per person—the equivalent of $8,000 today. That’s in the middle of the range of what the World Bank classifies as “middle-income” countries,” the report stated.
“At the end of 2023, 108 countries were classified as middle-income, each with annual GDP per capita in the range of $1,136 to $13,845. These countries are home to six billion people—75% of the global population—and two out of every three people living in extreme poverty,” the report added.
The future presents much more formidable obstacles in contrast to these encountered up to now, together with quickly ageing populations, mounting debt, intense geopolitical and commerce tensions, and the rising problem of accelerating financial development with out damaging the atmosphere.
“Yet many middle-income countries still use a playbook from the last century, relying mainly on policies designed to expand investment. That is like driving a car just in first gear and trying to make it go faster,” the report stated.
The report means that these nations want to undertake new methods and insurance policies to successfully navigate the challenges forward and obtain sustainable financial progress.
Chief Economist of the World Bank Group and Senior Vice President for Development Economics Indermit Gill stated growing nations should not persist with the outdated playbook, most growing nations will lose the race to create fairly affluent societies by the center of this century.
“The battle for global economic prosperity will largely be won or lost in middle-income countries,” Gill stated.
“But too many of these countries rely on outmoded strategies to become advanced economies. They depend just on investment for too long—or they switch prematurely to innovation. A fresh approach is needed… With growing demographic, ecological and geopolitical pressures, there is no room for error,” he added.
The World Bank report outlines a method for these nations to attain high-income standing, which includes implementing a sequenced and more and more refined mixture of insurance policies primarily based on their present stage of improvement.
“Since 1990, only 34 middle-income economies have managed to shift to high-income status—and more than a third of them were either beneficiaries of integration into the European Union, or of previously undiscovered oil,” the World Bank report added.
(With inputs from companies)
More than 100 nations, together with India, China, Brazil, and South Africa face critical challenges in changing into high-income nations within the subsequent few many years, the report stated.
According to the World Development Report 2024: The Middle Income Trap, “At current trends, it will take China more than 10 years just to reach one-quarter of US income per capita, Indonesia nearly 70 years, and India 75 years.”
“Drawing on lessons of the past 50 years, the study finds that as countries grow wealthier, they usually hit a “trap” at about 10% of annual US GDP per person—the equivalent of $8,000 today. That’s in the middle of the range of what the World Bank classifies as “middle-income” countries,” the report stated.
“At the end of 2023, 108 countries were classified as middle-income, each with annual GDP per capita in the range of $1,136 to $13,845. These countries are home to six billion people—75% of the global population—and two out of every three people living in extreme poverty,” the report added.
The future presents much more formidable obstacles in contrast to these encountered up to now, together with quickly ageing populations, mounting debt, intense geopolitical and commerce tensions, and the rising problem of accelerating financial development with out damaging the atmosphere.
“Yet many middle-income countries still use a playbook from the last century, relying mainly on policies designed to expand investment. That is like driving a car just in first gear and trying to make it go faster,” the report stated.
The report means that these nations want to undertake new methods and insurance policies to successfully navigate the challenges forward and obtain sustainable financial progress.
Chief Economist of the World Bank Group and Senior Vice President for Development Economics Indermit Gill stated growing nations should not persist with the outdated playbook, most growing nations will lose the race to create fairly affluent societies by the center of this century.
“The battle for global economic prosperity will largely be won or lost in middle-income countries,” Gill stated.
“But too many of these countries rely on outmoded strategies to become advanced economies. They depend just on investment for too long—or they switch prematurely to innovation. A fresh approach is needed… With growing demographic, ecological and geopolitical pressures, there is no room for error,” he added.
The World Bank report outlines a method for these nations to attain high-income standing, which includes implementing a sequenced and more and more refined mixture of insurance policies primarily based on their present stage of improvement.
“Since 1990, only 34 middle-income economies have managed to shift to high-income status—and more than a third of them were either beneficiaries of integration into the European Union, or of previously undiscovered oil,” the World Bank report added.
(With inputs from companies)
