A (very long) Indian summer is coming, and there will be opportunities for Australia

China’s rise over recent decades has been impossible to ignore. But economic forecasters now actually rank the country only second when it comes to expected speed of growth over the next decade – with India, and its coming people-powered consumer boom, expected to have an even higher crest.

Not unlike its near neighbour, the numbers around India are staggering.

Already the world’s third largest economy, growth in 2018 is expected to be close to 7.0%, and by 2035 India’s share of global GDP could be on par with the United States. It will also be the world’s most populous nation, with a forecast 1.6 billion people and a rapidly growing and highly educated middle class.

So the big levers of economic potential—the ‘3Ps’ of population, participation, and productivity—are all set to surge in India, and the country is increasingly benefiting from both structural reforms and greater stability.

Changing demographics, along with increased productivity and participation in the workforce of younger people will fundamentally shift the impact India has on the world economy.

India is an awakening giant, and its rise as an economic superpower is about to be felt in earnest. The country will account for more than half of the increase in Asia’s workforce in the coming decade, and the consequences for businesses are vast.

We’re calling this major change an Indian summer…but it’s not just one seasonal shift in one year (or even 10 for that matter). The world is looking at 50 years of opportunity, and opportunity that Australia would be mad not to take.

Australia has what India will need

A growing India is going to need many of Australia’s goods and services, and the Federal Government’s India Economic Strategy to 2035 – Navigating from Potential to Delivery, prepared by former Department of Foreign Affairs and Trade Secretary, and now Chancellor of the University of Queensland, Peter Varghese, outlines the available opportunities.

An ambitious plan to transform Australia’s economic partnership with India out to 2035, the Strategy, recommends that Australia aim to lift India into its top three export markets by 20135 and make the country the third largest destination in Asia for outward Australian investment. This would see Australian exports to India treble to around $45 billion, and investment in the country rise 10 fold to over $100 billion.

Education is our standout opportunity sector, followed closely by agribusiness, resources and tourism. But there is also significant potential across the likes of energy, health, financial services, infrastructure, science and innovation, and even sport.

The realise this vision, governments – federal and state – and business will need to be closely aligned at the highest levels in getting the strategy and execution right to ensure Australia is best positioned in what will be a competitive field.

50 years of opportunity

India’s rise as an economic superpower, and its demands and priorities, is about to be felt in earnest.

If Australia gets things right, the consequences for our continuing prosperity (something we should never take for granted) – as well as India’s – will be considerable.

Harsh Shah is a Deloitte Assurance & Advisory partner.

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