India Set To Become World’s Fourth Largest Economy In 2025: IMF

The International Monetary Fund’s (IMF) World Economic Outlook April 2025 edition predicts that India will overtake Japan to become the world’s fourth-largest economy in 2025.

The IMF has projected India’s nominal GDP for FY26 at $4,187.017 billion, marginally surpassing Japan’s estimated $4,186.431 billion.

India Climbs Global Economic Rankings

Until 2024, India held the fifth position in the global economic rankings.

The latest IMF projections now place India in the fourth spot in 2025, driven by strong private consumption and structural reforms.

Looking ahead, India is on track to surpass Germany by 2028, becoming the third-largest economy with a projected GDP of $5,584.476 billion, outpacing Germany’s $5,251.928 billion.

India is set to achieve a $5 trillion GDP in 2027, projecting an economic output of $5,069.47 billion.

US And China To Retain Top Positions

The United States and China will remain the top two economies globally in 2025, and the IMF expects them to maintain these positions through the decade.

While India’s growth is accelerating, the gap between the top three economies and the rest remains significant.

IMF Flags Global Economic Reset

In its report, the IMF warned of a major transformation in the global economic landscape.

It stated that the global economic system that has been in place for over 80 years is undergoing a reset, ushering in a new era of trade dynamics and geopolitical realignments.

Growth Outlook For India Adjusted to 6.2%

The IMF revised India’s GDP growth forecast for 2025 to 6.2%, down from its January 2025 estimate of 6.5%.

This adjustment reflects increasing global uncertainties, particularly those stemming from US President Donald Trump’s tariff decisions, which have intensified global trade tensions.

“For India, the growth outlook remains relatively stable,” the IMF noted, “supported by strong private consumption, especially in rural areas, but higher trade tensions have tempered expectations.”

Despite the slight downgrade, India continues to demonstrate robust economic momentum and a growing influence on the global stage.

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