India’s Growing Economy Set To Pivot Its Role On Global Stage: Nobel Laureate Michael Spence

India is poised to boost its economic and geopolitical role in the coming decades, helped by an evolving demographic dividend, rapidly expanding digital economy and GDP growth rates that top the world's major economies, Nobel Laureate Michael Spence has said.

Spence further said India's leap on the technology front will be a key catalyst for the economic expansion of the nation, currently the world’s fifth biggest economy and its pivotal position in international affairs.

"As somebody who has spent the last 25 years thinking about growth in one form or another in virtually every corner of the world, let me just say that the major economy with the highest potential growth rate is India," he told ET NOW.

The eminent economist said in a panel discussion with ET Now at Bennett University that India has successfully developed, by far, the best digital economy and financial architecture in the world.

"It is a transformational architecture," he said.

Spence said the relatively open global economic system that has been in place for over 70 years is now breaking down under the pressure of an enormous array of shocks, pandemics, and geopolitical tensions involving the US and China.

"This is the world that has characteristics and experiences that we have not felt for the last three decades. That’s what I mean by regime change and disruption," he noted.

Responding to a question on crypto assets, Spence said cryptocurrency is not a currency, because a currency is a store of value and a medium of exchange.

"If its value changes by a factor of 20 or 30% in a week, it is hard to believe it is a store of value," he said, adding that it is only a currency for those people who want to hide in the darknet.

He opined that what the world will have is central bank digital currency.

While noting that whole economies and financial systems are going digital and so do currencies, Spence said, "The notion that we will have an economy running on a currency that’s entirely decentralised -- is not going to happen."