India Overtakes Japan to Become World's Fourth Largest Economy

India has surpassed Japan to become the world's fourth largest economy, with a gross domestic product (GDP) of $4.18 trillion, according to an announcement by the government on Tuesday. The government also stated that India is on track to overtake Germany to become the third largest economy by 2030.

The data, released by the Ministry of Statistics and Programme Implementation, shows that India's real GDP grew by 8.2% in the second quarter of fiscal year 2025-26, up from 7.8% in the first quarter and 7.4% in the fourth quarter of the previous fiscal year. This growth rate makes India the fastest-growing major economy in the world, the government said.

The figures are based on nominal GDP in current US dollars, a standard measure for comparing the size of economies. India's rise to the fourth position underscores its sustained economic expansion over the past decade, driven by domestic consumption, services, and manufacturing. The government attributed the growth to structural reforms and increased investment.

Japan's economy, meanwhile, has faced stagnation and demographic challenges, contributing to its decline in the rankings. Germany currently holds the third position with a GDP of approximately $4.6 trillion, according to World Bank data.

Economists have noted that while India's nominal GDP ranking is significant, its per capita income remains much lower than that of other major economies. The government emphasized that the growth trajectory is expected to continue, with projections suggesting India could become the third largest economy by 2030 if current trends persist.