India poised to surpass Japan as fourth-largest economy by 2025, predicts Amitabh Kant

India, under the astute projections of G20 Sherpa Amitabh Kant, is poised to ascend the global economic ladder, aiming to surpass Japan as the fourth-largest economy by 2025. Kant, drawing from a plethora of macroeconomic indicators, foresees India's GDP eclipsing Japan's, marking a significant milestone in the nation's economic trajectory.

 

Currently ranked fifth in terms of GDP size, India's ascent to the top echelons of the global economy signifies a remarkable transformation. Kant notes that just a decade ago, India ranked eleventh, highlighting the rapid pace of its economic growth. With a current GDP estimated at around USD 3.7 trillion, India's strides are evident.

 

Key factors contributing to India's rise, as outlined by Kant, include robust GST collection, sustained GDP growth exceeding 8 percent over the past three quarters, and expanded currency trading with 27 countries. Notably, India's journey from the "Fragile 5" in 2013, a term coined to describe economically struggling emerging nations, to a top global contender, underscores its resilience and progress.

 

Moreover, India's prowess in sectors like steel, cement, and automobile manufacturing, coupled with its leadership in digital infrastructure, further bolster its economic standing. The widespread adoption of digital transactions, exemplified by 134 billion e-transactions accounting for 46 percent of global digital payments, showcases India's technological prowess.

 

Additionally, initiatives like the Jan Dhan, Aadhaar, and Mobile trinity, with current balances exceeding Rs 2.32 lakh crore, reflect inclusive economic growth. Furthermore, India's success in curbing inflation and maintaining political stability at the central government level adds to its economic allure.

 

Firm GDP growth forecasts, manageable inflation levels, and prudent monetary policies by the central bank contribute to India's positive economic outlook. Notably, India's robust GDP growth of 8.4 percent in the October-December quarter of the financial year 2023-24 positions it as the fastest-growing major economy.

 

With the International Monetary Fund (IMF) raising India's growth projections for 2024 to 6.8 percent, India's economic trajectory remains promising. Having grown at 7.2 percent in 2022-23 and 8.7 percent in 2021-22, India's steadfast economic growth underscores its emergence as a global economic powerhouse.