Bharat Global Time Staff | May 25, 2025
New Delhi/Tokyo: In a historic economic milestone, India has officially surpassed Japan to become the fourth-largest economy in the world, according to the latest global GDP rankings released this week by the International Monetary Fund (IMF) and the World Bank.
This marks a major shift in the global economic order, placing India just behind the United States, China, and Germany in terms of nominal GDP.
“This is not just a symbolic victory — it reflects decades of sustained growth, policy reforms, and the sheer scale of India’s domestic consumption and industrial expansion,” said Dr. Aarti Mehta, a senior economist at the Indian Council for Economic Research.
The Numbers That Matter
As per the updated data:
- India’s nominal GDP now stands at approximately $4.45 trillion
- Japan’s GDP has slowed slightly to $4.3 trillion, due to sluggish consumer demand and an aging population
- The shift was driven by India’s strong performance in manufacturing, digital services, exports, and domestic consumption, along with the strength of the Indian rupee against the yen
India had previously overtaken the United Kingdom in 2022 to become the 5th largest economy.
What’s Driving India’s Growth?
India’s economic engine has been firing on multiple fronts:
- A booming digital economy, led by tech startups and the IT services sector
- A focus on infrastructure, manufacturing, and exports under the Make in India campaign
- Robust foreign direct investment (FDI) inflows and strategic trade partnerships
- Demographic advantage, with the world’s largest youth population driving consumption and innovation
Meanwhile, Japan continues to grapple with long-term issues like a shrinking workforce, deflationary pressures, and a heavy public debt load.
Government Reaction
Prime Minister Narendra Modi hailed the achievement as “a proud moment for every Indian.” In a statement, he emphasized that this milestone is a result of “collective efforts and resilience shown by our people, industries, and governance.”
“India’s rise is not just about numbers — it’s about the aspirations of 1.4 billion people finally taking center stage in the global economy,” the PM said.
Finance Minister Nirmala Sitharaman echoed the sentiment, saying this is “just the beginning” and that India’s focus now is on sustainable, inclusive growth.
Global Impact & Reactions
International analysts are watching the shift closely. India’s rise is expected to have significant implications for:
- Global trade and supply chains
- Geopolitical balance in the Indo-Pacific
- The evolving role of emerging economies in international financial institutions like the IMF and G20
“India is now a global economic heavyweight. It will have a stronger voice in shaping the future of trade, climate, and digital regulation,” said Simon Clarke, senior fellow at the Brookings Institution.
At a Glance:
- 🇮🇳 India becomes 4th largest economy, overtaking 🇯🇵 Japan
- India GDP: $4.45 trillion | Japan GDP: $4.3 trillion
- Powered by tech, manufacturing, youth-driven consumption
- Signals a shift in the global economic power structure
Editor’s Note: India’s economic ascent is more than a ranking — it’s a reflection of transformation. With 1.4 billion dreams fueling its momentum, the next stop on India’s journey could be even bigger.
