India set to become upper middle-income economy by 2030 as per capita income nears $4,000: SBI report

India’s economic expansion is accelerating sharply, with SBI Research projecting that the country will reach the $5-trillion mark in around two years and emerge as the world’s third-largest economy by 2028, according to its latest Ecowrap report.

The report traced India’s growth trajectory and stated that the economy took nearly 60 years to reach the $1-trillion milestone, but the pace has since gathered momentum. India doubled its economic size to $2 trillion by 2014, crossed $3 trillion in 2021 and reached $4 trillion in 2025, SBI Research stated, adding that the $5-trillion milestone is likely to be achieved in about two more years as successive targets are met in increasingly shorter intervals.

SBI Research placed India among the world’s fastest-growing major economies, noting that over the decade ended 2024, the country ranked in the 95th percentile of the global distribution of average real GDP growth, reflecting a marked improvement in its relative economic position.

According to the report, India is on course to transition into the upper middle-income category by 2030 under the World Bank’s classification framework. SBI Research stated that the threshold for this category is a per capita gross national income of around $4,500 and that India can and will move into this bracket within the next few years.

The report noted that India reached a per capita income of $1,000 in 2009 and $2,000 in 2019. Based on current projections, SBI Research stated that India achieved $1,000 per capita income in 62 years after independence and is expected to reach $3,000 per capita in another seven years by 2026.

By the end of the decade, per capita income is projected to approach $4,000, enabling India to transition to an upper middle-income economy by 2030 and join countries such as China and Indonesia under the current World Bank classification, the report said.

The analysis also highlighted broader global trends, noting that between 1990 and 2024, the number of high-income countries rose from 39 to 87, while the number of low-income economies nearly halved over the same period.

Looking beyond 2030, the SBI Ecowrap assessed India’s longer-term goal of attaining high-income status by 2047. The report stated that if the current per capita GNI threshold for a high-income country of $13,936 is used as a benchmark, India’s per capita GNI would need to grow at a compound annual growth rate of 7.5 percent to reach that level by 2047.

SBI Research added that this appears achievable, given that India’s per capita GNI has grown at a CAGR of 8.3 percent over the past 23 years. However, the report cautioned that the high-income threshold itself may rise over time. If it increases to $18,000, the required pace of growth would be higher. Assuming average population growth of 0.6 percent and a steady deflator, this would translate into nominal GDP growth in dollar terms of around 11.5 percent over the next 23 years, underscoring the need for sustained economic reforms.