India set to overtake Japan as fourth-biggest economy next year, adviser says

New Delhi – India is expected to overtake Japan to become the fourth-largest economy in nominal terms by the end of next March, V. Anantha Nageswaran, chief economic adviser to the Indian government, has said.

Nageswaran predicted that India will rank behind the United States, China and Germany in global nominal gross domestic product rankings by the end of March 2027 but will not overtake Japan within this year as initially expected.

“You can’t say that there are too many weak spots” in the Indian economy, he said in a recent interview, noting that it grew 7.8% year on the year from April to June. He argued that India has done better on job creation and income growth than Western countries.

At the same time, Nageswaran acknowledged that youth unemployment, particularly among women in urban areas, remains a problem, and that progress in addressing it has been slow.

He said that New Delhi must focus more on agriculture as an industry that will drive future economic growth.

“I think we are not fully tapping the potential of the agriculture sector, especially value addition, aggregate processing” and so on, he said. “We need to do a lot more.”

Nageswaran also said that Japan’s “small and medium enterprise ecosystem” has accumulated an enormous amount of intellectual property, from which India can benefit greatly. He expressed hopes for greater investment in India in fields such as precision equipment, machine tools and semiconductors.