India has officially become the fourth-largest economy in the world, overtaking Japan, as confirmed by NITI Aayog CEO BVR Subrahmanyam on Saturday (May 25, 2025). The announcement was made during the 10th Governing Council Meeting of NITI Aayog.
Citing International Monetary Fund (IMF) data, Subrahmanyam stated that India’s GDP now stands at $4.187 trillion, slightly ahead of Japan’s $4.186 trillion. This milestone is seen as a major indicator of India’s growing economic strength and global standing.
Global Economic Rankings (2025):
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United States
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China
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Germany
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India
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Japan
India’s ascent marks a significant shift in global economic power dynamics, particularly in the Indo-Pacific region.
Key Drivers Behind India’s Rise:
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Robust Reforms: Economic liberalization, tax reforms like GST, and investment in infrastructure have boosted growth.
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Digital Transformation: India’s growing digital economy and tech sector have added substantial value to GDP.
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Make in India & PLI Schemes: These have strengthened the manufacturing base and exports.
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Service Sector Dominance: IT, fintech, and other service sectors continue to grow at a rapid pace.
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Favorable Demographics: A young and growing workforce is supporting economic productivity.
What Lies Ahead?
According to Subrahmanyam, India is poised to overtake Germany within the next 2.5 to 3 years, thereby becoming the third-largest economy in the world. The IMF also projects India’s GDP growth rate to be 6.2% in 2025 and 6.3% in 2026, significantly higher than the global average.
Conclusion:
India’s rise to the fourth spot reflects a resilient, reform-driven economy that is well-positioned for future growth. With sustained momentum, strong governance, and international partnerships, India is on course to become a top-3 global economic power in the near future.
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