India Overtakes Japan to Become World’s Fourth-Largest Economy
According to the Economic Desk of Webangah News Agency, India has overtaken Japan to become the world’s fourth-largest economy following a period of sustained high growth. The country’s economic expansion has exceeded expectations, positioning it to potentially claim the third spot in the near future.
Current trends suggest India could surpass Germany within the next three years, solidifying its place as the third-largest global economy. The Indian government’s year-end economic report reveals the nation’s GDP has reached approximately $4.18 trillion, with projections estimating it could grow to $7.3 trillion by 2030.
India’s real GDP growth rate for the second quarter of the 2025-2026 fiscal year stood at 8.2%, up from 7.8% in the previous quarter, marking the highest growth rate in the past six quarters. Export performance has also strengthened, with merchandise exports reaching $38.13 billion in November, driven by shipments of engineering goods, electronics, pharmaceuticals, and petroleum products.
While official confirmation awaits the release of final annual GDP figures in 2026, the International Monetary Fund (IMF) predicts India will surpass Japan next year. The Reserve Bank of India has revised its economic growth forecast for the 2025-2026 fiscal year upward to 7.3%.
India’s economic growth has been primarily fueled by strong domestic demand, particularly private consumption, despite ongoing global trade uncertainties. However, challenges remain, including a significant income gap with advanced economies. World Bank data shows India’s per capita GDP was $2,694 in 2024, approximately 12 times lower than Japan’s $32,487 and 20 times lower than Germany’s $56,103.
India became the world’s most populous country in 2023, surpassing China. Government statistics indicate over a quarter of India’s 1.4 billion population is aged between 10 and 26 years, creating pressure to generate sufficient well-paying jobs for millions of young graduates. Currency pressures have also intensified, with the rupee hitting record lows against the dollar in early December 2025 amid trade tensions with Washington and increased tariffs on Indian goods.
The IMF notes India became the world’s fifth-largest economy in 2022, surpassing its former colonial ruler, the United Kingdom.
