India overtakes Japan to become world’s 4th largest economy
•India has officially surpassed Japan to become the world’s fourth-largest economy, according to NITI Aayog CEO BVR Subrahmanyam, citing IMF data.
1. Economic Milestone
•India’s nominal GDP has reached $4.187 trillion, overtaking Japan’s $4.186 trillion.
This marks a significant shift in global economic rankings, placing India behind only the US, China, and Germany
2. Growth Trajectory & Future Projections
•India is projected to become the third-largest economy by 2027, surpassing Germany.
•The IMF’s World Economic Outlook estimates India’s economy will grow at 6.2% in 2025 and 6.3% in 2026, maintaining its position as the fastest-growing major economy.
3. Key Drivers of Growth
•Strong demographics: A young workforce and expanding middle class.
•Policy reforms: Government initiatives supporting infrastructure, digital economy, and manufacturing.
•Global trade dynamics: India’s increasing role in supply chains and technology exports.
4. Challenges & Comparisons
•Despite its GDP growth, India’s per capita income remains significantly lower than Japan’s:
–India: $2,880
–Japan: $33,960.
•Economic disparities and income inequality remain key challenges.
5. Strategic Implications
•Strengthens India’s global economic influence and trade partnerships.
•Positions India as a key player in international policymaking.
•Encourages further investment in technology, defence, and infrastructure.
About NITI Aayog
•NITI Aayog (National Institution for Transforming India) is the premier policy think tank of the Government of India, established to drive economic development and cooperative federalism.
1. Formation & Purpose
•Established on January 1, 2015, replacing the Planning Commission.
•Functions as a policy advisory body, focusing on long-term strategic planning.
•Encourages state participation in economic policymaking through a bottom-up approach.
2. Structure & Leadership
•Chairperson: Prime Minister of India.
•Vice Chairperson: Appointed by the PM.
CEO: Oversees implementation of policies.
•Includes Chief Ministers, Lieutenant Governors, and experts from various fields.
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