India Becomes World’s Fourth-Largest Economy, to Surpass Germany in 2–3 Years: Govt

India has overtaken Japan to become the world’s fourth-largest economy, the government said in a statement on Tuesday.

With a gross domestic product (GDP) of USD 4.18 trillion, India is now also the fastest-growing major economy globally and is projected to surpass Germany to become the third-largest economy by 2028. The United States remains the world’s largest economy, followed by China in second place.

“With GDP valued at USD 4.18 trillion, India has surpassed 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 USD 7.3 trillion by 2030,” the Press Information Bureau (PIB) said in a release outlining key reforms and economic indicators for 2025.

The government said India’s real GDP grew by 8.2 per cent in the second quarter of FY 2025–26, up from 7.8 per cent in the first quarter and 7.4 per cent in the fourth quarter of FY 2024–25. The acceleration in growth was driven by resilient domestic demand despite global trade and policy uncertainties.

GDP growth in Q2 of FY 2025–26 marked a six-quarter high, with the government noting that strong private consumption played a central role in supporting the expansion.

The statement also said the Reserve Bank of India (RBI) has revised its GDP growth forecast for FY 2025–26 upward from 6.8 per cent to 7.3 per cent. It highlighted optimistic growth projections from several international agencies as well.

According to the release, the World Bank projects India’s growth at 6.5 per cent in 2026, while Moody’s expects the country to remain the fastest-growing G20 economy with growth of 6.4 per cent in 2026 and 6.5 per cent in 2027. The International Monetary Fund (IMF) has raised its projections to 6.6 per cent for 2025 and 6.2 per cent for 2026. The OECD forecasts growth of 6.7 per cent in 2025 and 6.2 per cent in 2026, while S&P expects growth of 6.5 per cent in the current fiscal year and 6.7 per cent in the next.

The Asian Development Bank has raised its 2025 growth forecast to 7.2 per cent, and Fitch has revised its FY26 projection upward to 7.4 per cent, citing stronger consumer demand.