India's economic triumph: Zooming past Japan to capture 4th spot globally

India surpassing Japan as the fourth-largest economy in 2025, inspired by the visionary and uplifting tone of Swami Vivekananda, whose words often emphasized India's potential, resilience, and spiritual strength as a foundation for progress: "Arise, awake, and stop not till the goal is reached! India, the land of ancient wisdom and boundless potential, has once again proven its mettle on the global stage.

- DR SUKANYA IYER

In 2025, our nation has surged past Japan to claim its place as the world's fourth-largest economy, a triumph of our collective spirit, youthful energy, and unwavering resolve.

Let me give you all a snapshot of Statistical information on GDP GROWTH in a detailed manner in the table.

Strong private consumption, especially in rural areas, supported by agricultural incomes and government programs.

Infrastructure investments (e.g., $1.5 trillion plan for 2020-2025) and digital economy growth (46% of global digital transactions).

Economic reforms like GST, FDI liberalization, and Production Linked Incentive (PLI) schemes.

India's ascent to the fourth-largest economy, surpassing Japan in 2025, is driven by a combination of structural, demographic, and policy-related economic factors.

Below is a detailed explanation of the key economic factors contributing to this milestone, based on available data and trends:

STRONG GDP GROWTH

India's Robust Growth: India's nominal GDP reached $4.187 trillion in 2025, as per the IMF's April 2025 World Economic Outlook, slightly ahead of Japan's $4.186 trillion. India's real GDP growth is projected at 6.2% for 2025 and 6.3% for 2026, significantly outpacing Japan's 0.6% growth.

Drivers of Growth: High private consumption, particularly in rural areas, and increased investment in infrastructure and manufacturing have fuelled India's economic expansion. The services sector, including IT and financial services, continues to be a major contributor, alongside growing industrial output.

CONTRAST WITH JAPAN

Japan's economy faces stagnation due to low consumer spending, limited productivity growth, and a declining workforce, which have constrained its GDP growth.

FAVOURABLE DEMOGRAPHICS