India has surpassed Japan to become the fourth-largest economy

Summary

India has surpassed Japan to become the world's fourth-largest economy, according to calculations in the Indian government's end-of-year economic review. On current trends, India is expected to overtake Germany to become the world's third-largest economy within the next three years, the review said. How big is India's economy? The review said India's gross domestic product has already reached about $4.18 trillion (€3.55 trillion), and is projected to reach $7.3 trillion by 2030. On current trends, it said, India would trail only the United States and China in economic heft. India's real GDP grew 8.2% in the second quarter of the 2025–26 financial year, up from 7.8% in the previous quarter and marking a six-quarter high. Export performance has also strengthened, the review noted. Merchandise exports rose to $38.13 billion in November, up from $36.43 billion in January, supported by engineering goods, electronics, pharmaceuticals, and petroleum products.India's economic boom creates regional divideTo view this video please enable JavaScript, and consider upgrading to a web browser that supports HTML5 video Official confirmation however depends on data due in 2026 when final annual GDP figures are released. The International Monetary Fund suggests India will surpass Japan next year. The Reserve Bank of India has revised its growth forecast for the 2025–26 financial year upward to 7.3%. Why might India's economy be booming? Growth was said to have been driven primarily by domestic demand, with particularly strong private consumption, despite continued global trade and policy uncertainty. The government described the current phase as a rare "Goldilocks" period of high growth and low inflation, saying strong corporate balance sheets, steady credit flows, and ongoing reforms have positioned India for sustained expansion. "India is among the world's fastest-growing major economies and is well-positioned to sustain this momentum." "With the ambition of attaining high middle-...