India is set to become the third largest economy in the world by 2030, according to latest estimates by a PricewaterhouseCoopers (PwC) report.

The London-headquartered accountancy giant said the rapid rise of the Indian economy with its young workforce would push it up from being the 10th largest economy in 2013 to the third largest by 2030, pushing the UK back into sixth place.

“In the longer run, other emerging markets may overtake the UK, but only India looks set to do so before 2030 according to our latest projections,” PwC said in its latest economic outlook.

China, the world’s second largest economy, is expected to close the gap with America by 2030, while Mexico is predicted to be the 10th largest economy by 2030, above Canada and Italy, both G7 nations.

Only a couple of years ago there were forecasts that Britain would rapidly become a second-class economic power and would need to defer to the BRIC countries of Brazil, Russia, India and China in the near future.

China has ranked above Japan for a decade as the world’s second-biggest economy.

By some calculations Brazil leapfrogged the UK in 2012, with Russia and India close behind.

Britain’s fall was partly related to the costs of the banking crisis and the recession that followed, coupled with a sharp decline in the exchange rate, which knocked about a quarter off the country’s value in relation to its main rivals.

But since the beginning of last year the economy has recovered all the lost ground from the recession and banks have begun lending again.

The pound has bounced back from about $ 1.40 in 2009 to $ 1.71 on Saturday.

Brazil, by contrast, has suffered a rocky couple of years that have slowed GDP growth and pushed down the value of the real.

Russia will close the gap on the top eight, but its reliance on the oil and gas industry for growth and its rapidly ageing population will prevent it jumping up the table as quickly as previously thought.

Only India will move ahead of the UK by 2030, though it will be sharing a projected GDP of $ 6.1 trillion among more than 1.5 billion people, only half as much again as the UK’s predicted output of $ 4 trillion, produced by a population less than a 20th the size.

PwC urged policymakers in the UK to implement further structural reforms to ensure that it remained ahead of emerging markets.