With India poised to overtake Japan as the world’s fourth-largest economy, industry players have hailed the International Monetary Fund’s (IMF) forecast as a sign of the South Asian country’s growing global stature, even as they call for deeper reforms to boost its competitiveness.
India’s nominal gross domestic product (GDP) is projected to rise to US$4.187 trillion in the 2025–26 financial year, surpassing Japan’s US$4.186 trillion economy, according to the IMF’s world economic outlook released in April. If realised, India’s GDP will rank behind that of the United States, China and Germany.
Speaking at a briefing over the weekend, B.V.R. Subrahmanyam, CEO of India’s state-run think tank Niti Aayog, attributed India’s economic ascendancy to favourable geopolitical conditions, strong domestic fundamentals, and its increasing significance in global supply chains in tandem with changing trade patterns.
Despite the sweeping global tariffs introduced by the US, India may benefit from relatively lower levies compared with those imposed on Washington’s other trade partners, according to analysts.
In response to India’s economic ranking, billionaire businessman Anand Mahindra has called for a rise in the country’s GDP growth as well as GDP per capita.
“While I was in business school, the idea of India overtaking Japan in GDP felt like a distant, almost audacious dream,” Mahindra said in a post on X.
