New Delhi, Jan 19 : India is set to transition into the upper middle-income country category by 2030, coinciding with its emergence as the world’s third-largest economy by 2028, according to a research report released by SBI here on Monday.
The report highlights India’s rapid economic ascent, placing it among the fastest-growing major economies globally over the past decade.
The analysis shows that India now stands at the 95th percentile in the global distribution of average real GDP growth for the decade ended 2024, an improvement from the 92nd percentile over a 25-year horizon.
This upward repositioning reflects a sustained acceleration in growth momentum, placing India deeper into the upper tail of global growth performers.
Tracing India’s income transition, the report notes that the country took nearly six decades to move from a low-income economy to a lower middle-income economy in 2007, with per capita GNI rising from USD 90 in 1962 to USD 910.
Since then, the pace has significantly quickened. India achieved a per capita income of USD 1,000 in 2009, crossed USD 2,000 in 2019, and is projected to reach USD 3,000 by 2026.
By 2030, per capita GNI is expected to touch around USD 4,000, meeting the World Bank threshold for entry into the upper middle-income category and placing India alongside countries such as China and Indonesia at their current classification levels.
The report also highlights the sharp acceleration in India’s overall economic scale. After taking 60 years to reach a USD 1 trillion economy, India added the second trillion in just seven years by 2014, the third trillion by 2021, and the fourth trillion by 2025.
The economy is projected to reach the USD5 trillion mark in another two years, reflecting a steep compression in the time taken to add each successive trillion dollars to GDP.
In nominal GDP rankings, India has climbed from the 14th position in 1990 to the fourth-largest economy in 2025 and is projected to overtake Germany to become the third-largest economy globally by 2028, behind only the United States and China. Looking ahead, India is expected to become a USD10 trillion economy by 2035.
The report places India’s progress in a global context, noting a broad shift in the World Bank’s income classification over the past three decades. Between 1990 and 2024, the number of high-income countries increased sharply, while the count of low-income countries nearly halved, reflecting widespread upward mobility across economies.
Comparisons with peer economies show that China and Indonesia successfully moved from low-income to upper middle-income status during this period. China’s per capita GNI rose sharply after 1990, supported by high investment rates and a strong manufacturing base. India, while following a different growth path, has also begun strengthening its manufacturing value-added share in GDP, which the report identifies as a crucial lever for sustaining long-term income gains.
Looking further ahead, the report assesses India’s prospects of becoming a high-income country by 2047, in line with long-term national development goals. To meet the current high-income threshold of around USD 13,900 per capita, India’s per capita GNI would need to grow at a compound annual rate of about 7.5 per cent.
This is considered achievable given that per capita GNI grew at an average annual rate of 8.3 per cent between 2001 and 2024.
However, if the high-income threshold rises to around USD 18,000 by that time, the required growth rate would increase to nearly 9 per cent.
Overall, the report concludes that India’s transition to an upper middle-income economy is well within reach over the next few years. Sustained reforms, higher productivity, and continued momentum in manufacturing and investment are expected to play a critical role in ensuring that India not only climbs the income ladder but maintains its position among the world’s fastest-growing major economies. (UNI)
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