India’s GDP ranking has slipped to 6th place in 2025–26: International Monetary Fund
India slipped to become the world’s 6th-largest economy in 2025, dropping one rank from the previous year, according to the latest World Economic Outlook (WEO) released by the IMF. The Indian economy is estimated at $3.92 trillion in 2025.
In April 2025 when the International Monetary Fund (IMF) released its World Economic Outlook, India was seen overtaking Japan to become the world’s fourth largest economy by the end of 2025-26. One year later, India has slipped to the sixth position on the largest economies rankings, with the United Kingdom reclaiming its spot as the fifth largest economy.
In fact, IMF’s latest World Economic Outlook (April 2026) sees India sitting at the sixth spot this financial year too. This projection comes even as India has grown better than expected in FY26 and is seen retaining its tag of being the world’s fastest growing major economy.
IMF Forecasts: According to April 2026 IMF projections, India is expected to regain its position as the world’s 4th-largest economy by 2027, with its nominal GDP projected to reach $4.58 trillion, overtaking the UK.
What has led to the sudden fall?
Why has India dropped to the sixth position, falling behind the UK, instead of overtaking Japan to become the fourth largest economy? And what does this setback mean for its dream of becoming the third largest economy by the end of this decade?
The first thing to understand is that IMF’s data on the size of a country’s nominal GDP is in dollar terms. Hence, with global rankings based on dollar‑denominated GDP, they are highly sensitive to exchange rate movements.
The biggest party pooper for India’s dream of becoming the fourth largest has been the rupee's slide. The Indian currency has depreciated more than expected over the last year, dropping from 84.57 versus the US dollar in 2024 to 88.48 in 2025, as per IMF data. The IMF estimates see it at 92.59 this year in 2026.
Several factors have contributed to the rupee's decline, including capital outflows, uncertainty related to India-US trade deal up until February, and the recent Middle East conflict which has raised crude oil prices and India’s import bill. Also, the RBI while actively managing volatility in the forex market, is not targeting any particular level of the rupee.
And it’s not just about the Indian economy. The United Kingdom which has overtaken India to bag the 5th spot again also has economic factors working in its favour. UK’s GDP growth at 0.5% has recently beaten forecasts of 0.1% by a wide margin. Not only that, its currency - pound - has actually appreciated against the US dollar.
The second factor that has impacted the rankings is India’s adoption of a new base year for its latest GDP series. As per the new data, which also makes use of a more refined methodology, the size of India’s nominal GDP in rupee terms has gone down.