India’s GDP Surge : Q4 2024-25 Growth and Global Economic Rise

India’s GDP growth continues to capture global attention, with the latest figures for Q4 FY 2024-25 (January–March 2025) reflecting a robust economic performance. This blog explores India’s recent GDP achievements, key drivers behind the growth, its new status as the world’s fourth-largest economy, and the challenges and opportunities shaping its GDP trajectory.

Q4 2024-25: A Strong GDP Performance

India’s GDP grew by an impressive 7.4% in the fourth quarter of FY 2024-25, exceeding market expectations. Key factors driving this GDP growth include:

• Agricultural Boost: Favorable monsoons and rising rural demand significantly enhanced agricultural contributions to GDP.
• Service Sector Exports: The IT and services sectors, critical to India’s GDP, thrived due to strong global demand for digital and tech solutions.
• Domestic Consumption: Accounting for over 56% of GDP, resilient consumer spending underscored the strength of India’s domestic market.

For the full fiscal year 2024-25, GDP growth is estimated at 6.5%, slightly below the National Statistical Office’s earlier projection of 6.6% but aligning with the Reserve Bank of India’s forecast. This steady GDP growth highlights India’s resilience amid global economic challenges.

A Global GDP Milestone

In a historic achievement, India has surpassed Japan to become the world’s fourth-largest economy in 2025, with a nominal GDP of $4.19 trillion, according to IMF data cited by NITI Aayog CEO BVR Subrahmanyam. This GDP milestone is driven by:

• Structural Reforms: Initiatives like “Make in India” have bolstered India’s GDP by positioning it as a global manufacturing hub.
• Government Investment: Strategic spending on infrastructure has been a key contributor to GDP growth.
• Demographic Advantage: India’s young, dynamic workforce continues to fuel GDP expansion.

This places India’s GDP behind only the United States, China, and Germany, cementing its status as a global economic powerhouse.

Challenges to Sustained GDP Growth

Despite the remarkable GDP growth, challenges persist:

• Low Per Capita GDP: At $2,880, India’s per capita GDP ranks 144th globally, signaling that economic gains are not yet equitable.
• Infrastructure Needs: Sustained investment in transportation, digital connectivity, and urban development is critical to support GDP growth.
• Equitable Development: Bridging disparities and fostering innovation are essential to ensure GDP growth benefits all segments of society.

Addressing these challenges will be crucial for sustaining and expanding India’s GDP in the long term.

India’s GDP : Future GDP Outlook

The economic outlook remains promising. Inflation is projected to ease to 4.3% in 2025, within the Reserve Bank of India’s target range, creating a stable environment for GDP growth. With ongoing reforms, a focus on manufacturing, and a vibrant services sector, India’s GDP is poised for continued expansion.

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India’s GDP growth of 7.4% in Q4 2024-25 and its rise to the world’s fourth-largest economy with a GDP of $4.19 trillion mark a transformative moment. While challenges like low per capita GDP and infrastructure gaps remain, India’s economic reforms and resilient domestic market set the stage for sustained GDP growth. As India continues to strengthen its global economic standing, its GDP trajectory will remain a key indicator to watch.