India has overtaken Japan to become the world’s fourth-largest economy, according to the government’s end-of-year economic review. Officials now expect India to move past Germany and become the third-largest economy within the next three years.
The review said India’s gross domestic product (GDP) is estimated at USD 4.18 trillion, placing it ahead of Japan. However, final confirmation will depend on the official GDP data to be released in 2026. The International Monetary Fund has also projected that India will cross Japan in the coming year. The government note said India remains one of the fastest-growing major economies and is well placed to maintain this growth momentum.
The review further added that India could overtake Germany in the next two-and-a-half to three years, with GDP projected to reach USD 7.3 trillion by 2030. At the same time, the report highlighted challenges. India’s per capita income remains low at USD 2,694 in 2024, much lower than Japan and Germany. With over a quarter of India’s 1.4 billion population aged between 10 and 26, job creation remains a key concern. The government said future growth will depend on generating quality employment and ensuring inclusive development. India became the world’s fifth-largest economy in 2022 after overtaking the United Kingdom.
