India Now 4th-Largest Economy, Surpassing Japan, Says NITI Aayog Chief

Ira Singh
Khabar Khabaron ki,26 May’25

India has officially surpassed Japan to become the world’s fourth-largest economy, according to NITI Aayog CEO B V R Subrahmanyam. Citing data from the International Monetary Fund (IMF), Subrahmanyam stated that India is now a $4 trillion economy, behind only the United States, China, and Germany.

“India has officially surpassed Japan to become the fourth-largest economy as I speak. We are a $4 trillion economy,” Subrahmanyam reportedly stated, . He further added that if the current trajectory continues, India is poised to become the third-largest economy in the next 2.5 to 3 years.

According to the IMF’s World Economic Outlook (WEO) report released in April 2024, India’s nominal GDP is projected to reach $4.187 trillion in 2025 (FY26), slightly ahead of Japan’s expected GDP of $4.181 trillion. The report confirmed India’s position as the fourth-largest economy based on nominal GDP.

Subrahmanyam also highlighted India’s rising competitiveness in manufacturing, emphasizing the country’s cost advantages in the global supply chain. In reference to U.S. President Donald Trump’s recent remarks about Apple iPhones being manufactured in the U.S. rather than in India or other countries, Subrahmanyam noted that while the impact of any potential tariffs remains uncertain, India will continue to be a cost-effective manufacturing destination.

“The dynamics may change, but given our cost advantage, we will continue to be a cheap place to manufacture,” he reportedly stated.

In addition to highlighting India’s economic milestone, Subrahmanyam also revealed that a second round of the government’s asset monetisation plan is currently in development and is expected to be announced in August, according to information.

IMF data also shows a significant rise in India’s per capita income, which has doubled from $1,438 in 2013–14 to an estimated $2,880 in 2025. This growth underscores the broader trend of economic expansion and rising income levels in the country over the past decade.

Until 2024, India held the position of the fifth-largest economy in the world. The latest IMF estimates mark a significant shift in global economic rankings, with India overtaking Japan as its economy continues to expand at a robust pace.The development is seen as a major milestone in India’s economic journey and reflects the country’s increasing role in the global economy.