India has emerged as the world’s fifth-largest economy, boasting a GDP of $3.89 trillion in FY 2023-24, with an impressive growth rate of 8.2%. Despite challenges such as global economic uncertainties and high inflation, the country has demonstrated resilience, reflected in robust GDP growth, a strong reserve of foreign exchange, and record foreign direct investment (FDI) inflows in 2024.
In terms of purchasing power parity (PPP), India ranks as the third-largest economy globally, with a GDP of $16.02 trillion, trailing only China and the United States, according to recent data from the International Monetary Fund (IMF). Projections by the World Bank indicate that India’s growth trajectory will remain steady, with a forecasted GDP growth of 7% in FY 2024-25 and robust growth expected through FY 2026-27.
India’s journey to becoming the third-largest economy in real GDP by 2030 hinges on its economic resilience and progressive policies. Alongside GDP performance, the nation’s ranking on international indexes paints a broader picture of its economic strengths and areas requiring improvement.
India’s 2024 Rankings on Global Economic Indexes
India’s standing in various global economic indexes showcases its progress and challenges. While its rapid urban development, wealth creation, and GDP growth emphasize its strengths, issues like low labor productivity and employment rates highlight ongoing hurdles.
For instance, India’s remarkable growth is evident in the recognition of four cities as the fastest-growing globally by Savills Research. Bengaluru tops the list, with Delhi, Hyderabad, and Mumbai also featuring in the top five. This urban development underpins India’s rise as a significant global economic force.
A Superpower in the Making
India’s transformation into a global superpower is becoming increasingly apparent. Ray Dalio’s Great Powers Index 2024 highlights the country’s favorable position, with low debt levels and strong projected real growth of 6.3% annually over the next decade. Strategic investments in infrastructure and military spending further strengthen its global standing and national security.
The nation’s infrastructure growth and economic policies position it favorably to lead on the world stage. As Dalio noted, “India’s economic trajectory suggests it will emerge as a key global power within the next decade.”
Rising Wealth and Billionaire Growth
India’s wealth creation has reached unprecedented levels, with billionaire wealth totaling approximately $1 trillion, accounting for 7% of global wealth. This surge has positioned Mumbai as the “Billionaire Capital” of the world, overtaking Beijing.
The Hurun Report 2024 underscores the growth of India’s wealthy population, with 94 new billionaires added this year—the highest globally after the US and China—bringing the total count to 271. India now ranks third worldwide in terms of its billionaire population.
The UBS Global Wealth Report 2024 also highlights India’s upward trajectory, ranking it 11th among nations with the fastest-growing millionaire populations. The report projects a 22% increase in the country’s millionaires over the next five years, solidifying its position as a hub for wealth creation.
Employment and Labor Productivity
India’s employment landscape witnessed significant shifts in 2024, with a record seven crore job applications—a 25% year-on-year increase. However, the employment-to-population ratio stands at 52.8%, with a labor dependency ratio of 1.52, indicating a considerable portion of the population remains outside the workforce.
Labor productivity remains a challenge. The International Labour Organization’s statistics reveal that India ranks 133rd globally in GDP per hour worked, with an average productivity rate of $8. The country also has one of the highest rates of prolonged working hours, with 51% of the workforce logging 49 or more hours weekly.
According to an ILO report, “India’s workforce is industrious, but addressing productivity gaps is crucial to achieving sustainable growth.”
Sustaining Momentum Amid Challenges
While India’s economic rise is undeniable, sustaining its momentum requires addressing critical challenges. Enhancing labor productivity, expanding workforce participation, and improving working conditions are vital for maintaining growth and ensuring better living standards for its population.
India’s multifaceted progress—marked by rapid urban development, wealth creation, and strategic investments—cements its position as a global superpower in the making. However, the journey ahead involves overcoming persistent challenges to unlock its full potential.
By focusing on these areas, India is poised to secure its place as a leader in the global economy, driving not only its growth but also contributing significantly to the world stage.