<p>India has moved past another important milestone by overtaking Japan to become the world’s fourth largest economy, with a GDP of over $4 trillion. Only the US, China and Germany are ahead now, and the NITI Aayog, which made the announcement, has expressed hope that the country will reach the third position in around three years. </p><p>The achievement is especially creditable because there were major challenges and disruptions in the form of a global slowdown, the Covid pandemic, inflationary and trade-related pressures and geopolitical issues. India is the only major economy which has maintained a 6 per cent or near-6 per cent growth in recent years. </p><p>Despite the challenges, its economy showed resilience and momentum on the back of increased domestic consumption, strong services and growth in digital sectors. </p><p>The country would have done better if agriculture had not suffered a setback in the recent quarters and manufacturing had done better. The momentum needs to be increased in the coming years. It should be noted that while the size of the economy tripled during the decade 2004-2014, it only doubled during 2014-24. There will be more challenges now with uncertainties created by the tariff war initiated by the US.</p>.<p>The NITI Aayog has said that the economic momentum will continue in the near future. There should not be any complacency, and sustained efforts should be made to preserve the gains and improve the performance in weaker areas. </p><p>Manufacturing is one such and the government has plans to strengthen the sector. Infrastructure, logistics and supply management need to be improved as well. While the gross FDI (foreign direct investment) inflows are healthy, the net FDI fell by more than 96% in 2024-25. </p><p>India lags behind in research and development – no country can maintain its position and momentum if its economy is not supported by research and knowledge. India’s rise has also been marked by jobless growth. The most important challenge for the country is to provide jobs for its burgeoning youth; its economy has the strength to do this.</p>.<p>The growth in the economy has, however, not economically empowered the citizens. India’s per capita GDP, which is a measure of living standards, is less than one-tenth of Japan’s. </p><p>The country is placed 141st in the world, behind Bangladesh, in this metric. The growth is very iniquitous, with 1% of the country’s population holding more than 40% of its wealth, while the bottom 50% own just 3%. The economic growth is also uneven across the country. For this growth to be real for most people, it should benefit them individually.</p>
<p>India has moved past another important milestone by overtaking Japan to become the world’s fourth largest economy, with a GDP of over $4 trillion. Only the US, China and Germany are ahead now, and the NITI Aayog, which made the announcement, has expressed hope that the country will reach the third position in around three years. </p><p>The achievement is especially creditable because there were major challenges and disruptions in the form of a global slowdown, the Covid pandemic, inflationary and trade-related pressures and geopolitical issues. India is the only major economy which has maintained a 6 per cent or near-6 per cent growth in recent years. </p><p>Despite the challenges, its economy showed resilience and momentum on the back of increased domestic consumption, strong services and growth in digital sectors. </p><p>The country would have done better if agriculture had not suffered a setback in the recent quarters and manufacturing had done better. The momentum needs to be increased in the coming years. It should be noted that while the size of the economy tripled during the decade 2004-2014, it only doubled during 2014-24. There will be more challenges now with uncertainties created by the tariff war initiated by the US.</p>.<p>The NITI Aayog has said that the economic momentum will continue in the near future. There should not be any complacency, and sustained efforts should be made to preserve the gains and improve the performance in weaker areas. </p><p>Manufacturing is one such and the government has plans to strengthen the sector. Infrastructure, logistics and supply management need to be improved as well. While the gross FDI (foreign direct investment) inflows are healthy, the net FDI fell by more than 96% in 2024-25. </p><p>India lags behind in research and development – no country can maintain its position and momentum if its economy is not supported by research and knowledge. India’s rise has also been marked by jobless growth. The most important challenge for the country is to provide jobs for its burgeoning youth; its economy has the strength to do this.</p>.<p>The growth in the economy has, however, not economically empowered the citizens. India’s per capita GDP, which is a measure of living standards, is less than one-tenth of Japan’s. </p><p>The country is placed 141st in the world, behind Bangladesh, in this metric. The growth is very iniquitous, with 1% of the country’s population holding more than 40% of its wealth, while the bottom 50% own just 3%. The economic growth is also uneven across the country. For this growth to be real for most people, it should benefit them individually.</p>
