India is set to overtake Japan and become the world’s fourth-largest economy in 2025, according to the latest data released by the International Monetary Fund (IMF). With a projected nominal GDP of dollar 4.187 trillion, India will edge past Japan, whose GDP is expected to be dollar 4.186 trillion next year. This milestone comes as India continues its robust growth trajectory despite global economic headwinds.
In 2024, India stood as the fifth-largest economy, with a nominal GDP of dollar 3.91 trillion, behind the United States (dollar 29.18 trillion), China (dollar 18.75 trillion), Germany (dollar 4.66 trillion), and Japan (dollar 4.03 trillion). The IMF projects India’s GDP to grow by 6.3 per cent in 2025, driven by strong domestic demand, especially rural consumption, compared to Japan’s projected 0.6 percent growth.
According to the IMF’s April 2024 World Economic Outlook, India’s economic outlook remains more stable than many advanced economies, even amid global uncertainties and heightened trade tensions. The fund estimates India will reach dollar 4.6 trillion in 2026, slightly trailing Germany’s dollar 4.9 trillion economy, which is expected to grow at a sluggish 0.9 percent rate.
Looking ahead, India’s ascent is projected to continue. By 2028, the IMF forecasts India’s GDP to touch dollar 5.58 trillion, overtaking Germany’s expected GDP of dollar 5.25 trillion, making India the third-largest economy globally. The United States and China will continue to dominate the top two positions with projected GDPs of dollar 34.34 trillion and dollar 23.1 trillion, respectively, by 2028.
Notably, India had already surpassed the UK and France in 2019 to become the world’s fifth-largest economy. Now, with momentum building and reforms underway, the country is rapidly closing the gap with some of the world’s most developed nations.
Currently, the United States contributes around 26 percent of global GDP (estimated at dollar 113.8 trillion), followed by China at 17 percent. These shares are expected to remain relatively stable through the decade.
India’s rise on the global economic ladder marks a significant moment in its development journey, signalling increasing global influence, growing domestic strength, and the potential to reshape the future of the world economy.
