India is poised to become the world's fourth-largest economy, a significant milestone in its rapid growth trajectory. However, despite this impressive progress, a cautionary note has been sounded by Claude Smadja, former Managing Director of the World Economic Forum (WEF). He warns against complacency, highlighting that India still lags considerably behind Japan when it comes to GDP per person.
While India's overall economic size is expanding rapidly, the wealth distributed among its vast population tells a different story. According to data from the International Monetary Fund (IMF) as of April 2025, India's Gross Domestic Product (GDP) per capita stands at approximately ₹2,46,944 (or about US$2,878.4).
In stark contrast, Japan's GDP per capita is significantly higher at around ₹29,13,134 (or about US$33,955.7). This means that, on average, a person in Japan earns about 11.8 times more than a person in India. This substantial disparity, with India's per capita GDP being roughly 8.5% of Japan's, indicates that while India's economy is growing in aggregate terms, the individual prosperity level still has a long way to catch up.
The focus on overall GDP figures, while important for national pride and global standing, should not overshadow the need to improve the living standards and income levels of every citizen. Achieving the status of the fourth-largest economy is a testament to India's economic dynamism and potential. However, true development implies a widespread increase in per capita income, ensuring that the benefits of growth reach all sections of society.
This per capita gap emphasises the ongoing challenges related to job creation, income distribution, education, healthcare, and infrastructure development. To genuinely narrow this gap with advanced economies like Japan, India must continue to prioritise policies that foster inclusive growth and enhance productivity across all sectors.
India's journey towards becoming the world's fourth-largest economy is a remarkable achievement. It signals the nation's increasing influence on the global stage. Nevertheless, the significant disparity in GDP per capita between India and Japan serves as a crucial reminder that sustained efforts are essential to translate aggregate economic growth into improved individual prosperity and a higher quality of life for all Indians.
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Published on: Jun 10, 2025, 2:52 PM IST
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