India becomes world’s 4th largest economy, to surpass Germany in next 2-3 years: Govt

India is also the world’s fastest-growing major economy with a size of USD 4.18 trillion, and is poised to overtake Germany to become the third-largest economy by 2028.

The United States is the world’s largest economy, followed by China which occupies the second position.

“With GDP valued at USD 4. 18 trillion, India has surpassed Japan to become the world’s fourth-largest economy and is poised to displace Germany from the third rank in the next 2.5 to 3 years with projected GDP of USD 7.3 trillion by 2030,” the release by the Press Information Bureau, which included snapshots of the reforms in 2025, stated.

The government statement said the real Gross Domestic Product (GDP) of the country has increased by 8.2 per cent in Q2 of FY 2025-26. This is an increase from 7.8 per cent growth in Q1, and 7.4 per cent growth in Q4 of FY 2024-25. The growth was led by “led by resilient domestic demand amidst global trade and policy uncertainties”, the release said.

Further, the GDP expanded to a six-quarter high in Q2 of 2025-26. “Domestic drivers-led by robust private consumption-played a central role in supporting this expansion,” the government said.

The release said that the Reserve Bank of India (RBI) has revised its GDP growth projection for FY 2025–26, up from 6.8% to 7.3%. It also highlighted growth projections made by international agencies.

“The World Bank projects 6.5% growth in 2026; Moody’s expects India to remain the fastest-growing G20 economy with growth of 6.4% in 2026 and 6.5% in 2027; the IMF has raised its projections to 6.6% for 2025 and 6.2% for 2026; the OECD forecasts 6.7% growth in 2025 and 6.2% in 2026; S&P anticipates growth of 6.5% in the current fiscal and 6.7% in the next; the Asian Development Bank has lifted its 2025 forecast to 7.2%; and Fitch has raised its FY26 projection to 7.4% on stronger consumer demand,” the release states.