Source DW
India has overtaken Japan to become the world’s fourth-largest economy, according to a new report, marking a significant milestone in the country’s long-term growth trajectory and its rising influence in the global economic order.
The report estimates that India’s gross domestic product (GDP) has surpassed that of Japan in nominal terms, driven by strong domestic demand, sustained government spending on infrastructure, a resilient services sector, and a steady recovery in manufacturing. This shift places India behind only the United States, China, and Germany among the world’s largest economies.
Economists attribute India’s ascent to a combination of structural reforms, demographic advantages, and a rapidly expanding consumer market. Large-scale investments in digital infrastructure, logistics, and renewable energy have also contributed to higher productivity and improved ease of doing business.
In contrast, Japan’s economy has faced prolonged challenges, including slow growth, an ageing population, weak domestic demand, and the impact of a depreciating yen. While Japan remains a global leader in technology and manufacturing, its economic expansion has lagged behind faster-growing emerging markets in recent years.
India’s rise comes at a time when global economic conditions remain uncertain, with geopolitical tensions, inflationary pressures, and slowing growth in several advanced economies. Despite these headwinds, India has continued to post relatively robust growth rates, supported by policy stability and increasing foreign investment interest.
Government officials and analysts say the new ranking underscores India’s growing role as a key driver of global growth. However, they also caution that sustaining this position will require continued reforms, job creation, skill development, and inclusive growth to ensure that economic gains translate into broader social and developmental outcomes.
With projections suggesting that India could climb further up the global economic rankings in the coming years, the latest report reinforces expectations that the country will play an increasingly central role in shaping the future of the world economy.
