Economic Superpowers : The Next Era

Over the past few centuries, the world has seen many revolutions. Those which totally changed the way people used to live; those which gave might and grandeur to some countries, and at the same time took that away from others. The Emergence of new economic superpowers is linked to such revolutions. Back in the 1700s, two of the world’s greatest economies – India and China, accounted for almost 50% of the world trade, majorly consisting of raw materials and agro-based products, the sublime speciality of both these asian economies.

But soon enough, the British came up with the world’s 1st Industrial revolution – the age of machine made goods, factories, small machine tools, and steam engines; and things have never been the same after that. Following these inventions, goods could be manufactured in more quantities at lesser costs with lesser manpower; and, improved transportation strengthened trade, productivity, and military might of Great Britain. The economic impact of this revolution was so powerful that it made the agrarian economies of India and China obsolete, and Britain emerged as the greatest superpower of the world by the end of 18th century. Its economic supremacy also boosted its political supremacy, so, over the next century, it conquered various regions and went on to form the greatest empire to have ever existed. 

The British empire in the 19th century

The 2nd Industrial revolution took place by the end of the 19th century, wherein, the USA came up with new innovations such as Petroleum, combustion engine, telephone, telegraph, electricity etc. Being the first to adopt these technologies, there was a huge surge in USA’s economic strength, and as it follows, political strength; therefore, USA emerged as the winner of this revolution and surpassed UK as the Global Superpower in the early 20th century.

The later part of the 20th century, and also the 3rd Industrial revolution was majorly about the age of nuclear technologies, automobiles, computers, softwares and much more. The USA, Japan, and the Soviet Union were the countries that mostly invented & adapted to these technologies and emerged as world superpowers through this revolution.

In the current scenario, according to economists, we are experiencing the 4th Industrial revolution- the digital age, wherein data, internet, Artificial Intelligence, machine learning, Augmented reality, internet of things (IOT), robotics, and smart devices are booming; where the Soviet Union has collapsed, Japan is still well placed in the world, and the USA is still the leading and most important economy, contributing $22.68 trillion out of the world’s $93.86 trillion nominal GDP (2021). But, according to projections of various economic analysts, the USA will be de-throned from this spot by the end of this decade (probably 2028), and China will take over as the largest economy in the world, which is not much of a surprise.

From being a struggling economy with a nominal GDP of $202.4 billion in 1980, China has really turned around the tables. Today, China has a nominal GDP of $16.64 trillion, and one out of every three products in the world are made in China. With a manufacturing industry this huge, having the most number of unicorn startups in the world, and home to the 2nd most powerful military in the world; ‘the factory of the world’ is clearly the best contender for being the next greatest global superpower.

Where does India stand?

Currently being the 5th largest economy of the world with $2.72 trillion nominal GDP, and an estimated growth rate of 9.5% for 2021-22;  India stands as a strong developing nation with huge potential. Infact, it has some edge over China as well –

  • it’s ready availability of youth workforce which counts for 34.33% of the total population, (China will soon face shrinking no. of workforce due to its one child policy);
  • the fastest growing population, which will generate huge demand in future, be it for any industry of any sector;
  • availability of various underpenetrated industries like – stock markets, green energy businesses, internet connectivity, e-commerce (both B2B and B2C), AI, Electric vehicles, Fast moving consumer goods (FMCG), infrastructure, logistics, and much more;
  • India is often termed as ‘pharmacy of the world’, as it produces and exports vital medicines at way cheaper rates than any other nation. India is the largest producer of vaccines. This sector also shows great promise in the future;
  • Ever increasing entrepreneurship.

The world has seen the emergence of new superpowers every time there has been a revolution in terms of innovation. Being a superpower gives a nation the power to exert its influence over others. Currently, the USA is using diplomacy to stay on top. While China and India continue to profit from huge local markets as they develop, giving national champions with massive economies of scale and serving as a magnet for foreign businesses and technology. This revolution, in the near future, holds a lot of changes in it. After all, revolutions make and break superpowers.

Bhavesh Rohra

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s