IMF Pushes India’s $5-Trillion Dream Further Ahead

India’s goal of becoming a $5-trillion economy is expected to take longer than previously projected, according to the latest estimates from the International Monetary Fund (IMF). The delay stems from slower nominal GDP growth and the rupee’s notable depreciation this year, both of which have weakened India’s dollar-denominated GDP performance.

The country, which initially set the target for 2024–25 and later revised it to 2027–28, is now expected to cross the $4-trillion mark only in FY26 and reach $4.96 trillion by FY28—still short of the milestone. The IMF anticipates India reaching $5.46 trillion in FY29 and surpassing $6 trillion by 2030. Former finance secretary Subhash Chandra Garg cautioned that missing the timeline could reflect the risk of slipping into a lower middle-income trap.

Despite the setback, India remains on track to become the world’s fourth-largest economy this year, overtaking Japan. The IMF projects India’s GDP at $4.12 trillion by the end of FY26, with real GDP growth estimated at 6.6% in 2025–26. It also highlighted strong recent performance, including 7.8% growth in the first quarter, and noted that reforms like GST will help shield the economy from global shocks, such as the recent US tariff hikes.

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