This week’s Commonwealth Heads of Government Meeting in London is more than usually significant. As the Queen has retired from travelling abroad, she is unlikely ever to preside over such a meeting again. And this is important because she has played a major role in keeping the Commonwealth united over the years and is still involved with the Queen’s Commonwealth Canopy, a major reforestation initiative. The meeting is important for other reasons too. Post Brexit it is likely that there will be new trade and possibly other initiatives within the Commonwealth. While behind the scenes there is increasing substantive discussion about whether the Prince of Wales should replace the Queen in time as Head of the Commonwealth.

 

But this meeting is also important for another reason. Every previous meeting of the Commonwealth Heads of Government has taken place with the UK as the dominant economy. As recently as 2000, the dollar size of the UK economy was more than twice as large as the next largest Commonwealth economy which was Canada. Even in 2010 the UK economy was 42% larger than the second largest which by then was India. This year India and the UK are neck and neck. When Cebr produced our World Economic League Table forecasts last December we predicted that India would overtake both the UK and France this year to become the world’s fifth largest economy. But the unexpected strength of sterling against the dollar this year means that the UK might after all stay ahead for one more year. But India is growing at over 7% while the UK is growing at less than 2%. So ‘il sorpasso’ cannot be long delayed and now looks likely to happen in 2019, though it all depends on the volatile sterling and rupee exchange rates against the dollar. By the time the next Commonwealth Heads of Government meeting is held in Kuala Lumpur, Malaysia in 2020, it is all but certain that India will be the largest Commonwealth economy.

 

When India becomes the largest economy in the Commonwealth, the character of the organisation could start to change. Cebr’s forecasts for 2032 show the Indian economy nearly three times larger than the UK economy which is still likely to be the next largest. With economic dominance will follow political influence as has already been shown in that quintessentially Commonwealth sport, cricket. Because of the success of the IPL, India now accounts for between 60 and 80% of world cricket revenues depending on how they are allocated. And there is no doubt now that India dominates world cricket.

 

Just as influence has followed the money in cricket, the same will happen in Commonwealth meetings. The Commonwealth was once called the British Commonwealth. It is unlikely ever to become the Indian Commonwealth in name. But it is likely to become that in fact….

 

 

Contact: 

Douglas McWilliams dmcwilliams@cebr.com
07710 083 652

Pablo Shah pshah@cebr.com
0207 324 2850