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India overtakes Japan to become world’s 4th-largest economy, government says
The United States remains the world’s largest economy, followed by China in second place.
The United States remains the world’s largest economy, followed by China in second place.
India has surpassed Japan to become the world’s fourth-largest economy with a gross domestic product of $4.18 trillion and is on track to overtake Germany to claim the third position by 2030, the government stated. With sustained momentum, India also continues to be the world’s fastest-growing major economy.
India’s real GDP expanded by 8.2 per cent in the second quarter of 2025-26, rising from 7.8 per cent in the first quarter and 7.4 per cent in the fourth quarter of the previous fiscal year, according to a PTI report. The government informed that GDP growth touched a six-quarter high in the second quarter of 2025-26, reflecting the economy’s resilience amid ongoing global trade uncertainties.
In a government release providing a snapshot of reforms in 2025, it was stated that with GDP valued at $4.18 trillion, India has overtaken Japan to become the world’s fourth-largest economy and is poised to displace Germany from the third rank in the next 2.5 to 3 years, with a projected GDP of $7.3 trillion by 2030. The United States remains the world’s largest economy, followed by China in second place.
The release stated that domestic drivers, particularly robust private consumption, played a central role in supporting economic expansion. It added that growth momentum surprised on the upside despite persistent global uncertainties.
The government further informed that several international agencies have echoed optimism about India’s outlook. The World Bank has projected economic growth of 6.5 per cent in 2026. Moody’s expects India to remain the fastest-growing G20 economy, forecasting growth of 6.4 per cent in 2026 and 6.5 per cent in 2027. The International Monetary Fund has raised its projections to 6.6 per cent for 2025 and 6.2 per cent for 2026, while the OECD has forecast growth of 6.7 per cent in 2025 and 6.2 per cent in 2026.
In addition, S&P anticipates growth of 6.5 per cent in the current fiscal year and 6.7 per cent in the next. The Asian Development Bank has lifted its 2025 forecast to 7.2 per cent, and Fitch has raised its FY26 projection to 7.4 per cent, citing stronger consumer demand.
The government stated that India is among the world’s fastest-growing major economies and is well positioned to sustain this momentum, with the ambition of attaining high middle-income status by 2047, the centenary year of its independence, built on strong foundations of economic growth, structural reforms and social progress.
The release also highlighted that inflation remains below the lower tolerance threshold, unemployment is on a declining trajectory and export performance continues to improve. It added that financial conditions remain benign, with strong credit flows to the commercial sector, while demand conditions continue to stay firm, supported by strengthening urban consumption.
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