India on track to become 3rd-largest economy by 2030 with projected $7.3 trillion GDP

India’s strong services activity has helped GDP growth comfortably beat expectations for the second quarter in a row, rising to an impressive high of 7.8 per cent for April-June 2025.

The swift growth in the first quarter of the current financial year further consolidates India’s position as the world’s fastest growing major economy.

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“Currently the world’s fourth-largest economy, India is on track to become the third-largest by 2030 with a projected $7.3 trillion GDP. This momentum is powered by decisive governance, visionary reforms, and active global engagement. Notably, growth is accelerating, with real GDP expected to rise by 7.8 per cent in Q1 FY 2025-26, up from 6.5 per cent a year earlier,” the government sources said on Saturday.

The ascent is powered by strong domestic demand and transformative policy reforms, making India a prime destination for global capital. With easing inflation, higher employment, and buoyant consumer sentiment, private consumption is expected to further drive GDP growth in the coming months.

Gross Domestic Product (GDP) reflects the size and health of an economy by capturing the total value of goods and services produced within a country. Real GDP, which measures the economy’s output after removing the effects of inflation, grew by 6.5 per cent in Q1 of 2024–25. In Q1 of FY 2025-26, real GDP is estimated at Rs 47.89 lakh crore, against Rs 44.42 lakh crore in Q1 of FY 2024-25, depicting an impressive growth of 7.8 per cent.

In Q1 of FY 2025-26, allied sector, comprising agriculture, livestock, forestry and fishing and mining and quarrying grew by 3.7 per cent in, up from 1.5 per cent in the prior corresponding period.

Secondary sector, comprising manufacturing, electricity, gas, water supply and other utility services and construction posted strong gains, with manufacturing (7.7 per cent) and construction (7.6 per cent) both crossing the 7.5 per cent growth mark.

Tertiary sector recorded a robust 9.3 per cent growth at constant prices, higher than 6.8 per cent in Q1 FY 2024-25.

India’s employment has surged, with 17 crore jobs created in the past decade, reflecting the government’s focus on youth-centric policies and its Viksit Bharat vision.

The Labour Force Participation Rate (LFPR) for individuals aged 15 years and above has increased from 49.8 per cent in 2017–18 to 60.1 per cent in 2023–24.

Notably, female LFPR increased from 23.3 per cent in 2017-18 to 41.7 per cent in 2023-24. This shows enhanced participation of women in economic activities across various categories, including rural and urban. Rural India shows 96 per cent rise in female employment whereas urban areas reflect 43 per cent growth.

India has rapidly emerged as a top global destination for Foreign Direct Investment (FDI), powered by a decade of structural reforms, investor-friendly policies, and rising competitiveness. Backed by improvements in global rankings and strategic initiatives, investor confidence has strengthened. India witnessed a historic $81 billion worth of foreign investments in FY24-25 alone.