India has overtaken Japan and become the world’s fourth-largest economy. Within three years, it could also surpass Germany, which is currently in third place. This follows from an economic assessment at the end of the year compiled by the Indian government and reported today by the AFP news agency. Official confirmation of the figures will only be possible once the final data on the development of gross domestic product (GDP) is published, which will happen next year. The International Monetary Fund (IMF) suggests that India could move ahead of Japan next year.
GDP of $4.18 Trillion and Ambitions for Third Place
“India is among the fastest-growing major economies in the world and has strong fundamentals to sustain this momentum,” the government said in its report. “With a GDP of $4.18 trillion (CZK 86.1 trillion), India has surpassed Japan to become the world’s fourth-largest economy. It is also poised to dethrone Germany from third place within the next two and a half to three years, as GDP is expected to rise to $7.3 trillion by 2030,” the report added.
According to IMF data, India became the world’s fifth-largest economy in 2022 when it pushed the United Kingdom out of that position. However, the IMF forecast expects India to move into fourth place only in 2026, when the size of India’s economy is projected to reach $4.51 trillion. Japan’s economy is estimated to be around $4.46 trillion The Indian government’s optimistic assessment comes despite concerns about the economy’s future after the United States imposed steep tariffs on India in August over its purchases of Russian oil. India said continued growth reflects its resilience amid ongoing geopolitical tensions.
Other indicators, however, offer a less rosy picture. In terms of population, India surpassed neighboring China in 2023 to become the most populous country in the world. According to World Bank data, GDP per capita in India in 2024 stood at $2,649. This is one-twelfth of the comparable figure for Japan, where it was $32,487, and one-twentieth of the figure in Germany, where it was $56,103.
Young Population, Jobs Challenge, and a Weaker Rupee
More than a quarter of India’s 1.4 billion people are aged between 10 and 26. However, unemployment among young graduates remains high, and the country struggles to create well-paid jobs for millions of young people.
At the beginning of December, the Indian rupee fell to a record low against the dollar, mainly due to persistent concerns about the failure to conclude a trade agreement with the United States and the negative impact of tariffs on the economy. Since the start of the year, the Indian currency has weakened by around five percent.
Source: ČTK
