New Delhi, Apr 16 (KNN) India slipped to become the world’s sixth-largest economy in 2025, dropping one rank from the previous year, according to the latest data from the International Monetary Fund, even as the country continued to record one of the fastest growth rates among major economies.
GDP Comparison with Global Peers
India’s gross domestic product (GDP) is estimated at USD 3.92 trillion in 2025, placing it behind the United Kingdom at USD 4 trillion and Japan at USD 4.44 trillion. The United States remains the largest economy at USD 30.8 trillion, followed by China at USD 19.6 trillion and Germany at USD 4.7 trillion.
The country had ranked fifth in 2024 with a GDP of USD 3.5 trillion, ahead of the UK at USD 3.4 trillion.
The decline in ranking comes despite India recording around 9 percent nominal growth in rupee terms during the year. However, a stronger US dollar and downward revisions to GDP under a new statistical series moderated the pace of expansion in dollar terms.
Exchange Rate Plays Key Role
Since global economic rankings are measured in US dollars, currency movements played a significant role. IMF projections indicate that the rupee weakened from around 84.6 per dollar in 2024 to 88.5 in 2025, with further depreciation expected over the medium term.
India is expected to retain its position as the sixth-largest economy in 2026, before regaining momentum in subsequent years.
India Likely to Overtake UK by 2027
According to projections, India is likely to overtake the United Kingdom by 2027, with GDP estimated at USD 4.58 trillion compared to Britain’s projected USD 4.47 trillion, returning to the fourth position globally.
The country is further expected to surpass Japan in 2028, when its economy is projected to reach USD 5.06 trillion, exceeding Japan’s USD 4.74 trillion.
However, under revised projections, India may move decisively into the third position only by 2031, with GDP estimated at USD 6.79 trillion.
Strong Growth Offset by Rupee Depreciation
While India’s real economic growth has remained robust, the steady depreciation of the rupee has offset gains in dollar-denominated GDP.
IMF data shows GDP rising from Rs 318 trillion in 2024 to Rs 346.5 trillion in 2025, though the increase appears more modest in dollar terms due to currency effects.
Despite the shift in rankings, India continues to be the fastest-growing major economy and is among the few large economies expected to sustain growth above 6 percent over the medium term.
By 2030, India’s economy is projected to reach USD 6.17 trillion, narrowing the gap with Germany, before firmly entering the global top three thereafter.
Economists noted that changes in global rankings largely reflect exchange rate fluctuations rather than underlying economic weakness, with India’s growth outlook supported by strong domestic demand and ongoing structural reforms.
(KNN Bureau)
