New Delhi, India, December 31, 2025
India has achieved a significant economic milestone, surpassing Japan to become the world’s fourth-largest economy by nominal gross domestic product (GDP).
Government data indicates India’s GDP has reached approximately $4.18 trillion, placing it ahead of Japan and behind only the United States, China, and Germany. This ranking is based on updated International Monetary Fund (IMF) projections for 2025 and 2026.
Strong domestic consumption, structural reforms, export growth, and robust performance in services and infrastructure sectors have driven this advancement. India remains one of the fastest-growing major economies globally.
In the second quarter of fiscal year 2025-26, India’s real GDP growth rate stood at 8.2%, the highest in six quarters and up from previous periods despite global trade uncertainties.
Looking ahead, sustained performance could position India as the third-largest economy by 2030, with projected GDP reaching $7.3 trillion. Global institutions support these outlooks: the World Bank estimates 6.5% growth for India in 2026, while Moody’s highlights it as the fastest-emerging G20 economy. IMF forecasts place India’s 2026 GDP near $4.51 trillion.
However, while national GDP has expanded impressively, per capita income remains comparatively low at around $2,694—far below Japan’s approximately $32,487 and Germany’s $56,103.
Experts emphasize the need for inclusive growth to ensure broader distribution of economic benefits. Priorities include job creation, skill development, social security enhancements, productivity improvements, and strengthening rural economies.
