Forget Becoming Third Largest, India Won’t Even be a $5 Trillion Economy by 2029

The government has denied that PM Modi had ever promised to make India a $5 trillion economy.

Modi government's 'third largest and $5 trillion economy' targets are off track.

(Photo: The Quint)

Of In 2019, when his first term (Modi 1.0) was concluding, Prime Minister Narendra Modi promised to make India a $5 trillion economy by the time his second term (Modi 2.0) concluded in 2024.

As India was not getting anywhere near the $5 trillion GDP mark, PM Modi began shifting gears and guaranteed India would be the third-largest economy by the end of his third term in 2029 (Modi 3.0).

Will India be a $5 trillion economy by the end of Modi 3.0, a full five years after its original year of promise? Will India be the third-largest economy by 2029?

Let us do a status check on both the promises and guarantees.

Modi 1.0 and The $5 Trillion Promise

I was the Secretary of Economic Affairs in 2019, in charge of finalising India’s Interim Budget of 2019-20, which was eventually presented by Piyush Goyal on 1 February 2019, as Arun Jaitley, the finance minister, had to be rushed to the US for a medical emergency.

The Modi government was in high spirits and promised to make, in the Interim Budget, a $2.70 trillion Indian economy (2018-19) into a $10 trillion economy by the middle of the 2030s—in about 16 years.

This ask needed India to grow 3.70 times at about 8.5 percent compounded annual growth rate (CAGR) in US dollars.

This was quite doable, given the fact that India's GDP had grown nearly six times in 13 years from $468 billion in 2000-01 to $1,847 billion in 2013-14, recording a higher CAGR of 11.13 percent.

PM Modi used to be much more ambitious and set quantifiable goals. After his spectacular victory in the 2019 Lok Sabha elections, NITI Aayog (vice-chairperson Dr Rajiv Kumar) proposed (as announced by PM Modi in the meeting of the Governing Council of NITI Aayog held in June 2019) to make India a $5 trillion economy by 2024.

I was left a little worried as I heard this announcement in the meeting, which I attended as finance secretary.

The normal interpretation of 2024 in India is the financial year 2023-24. This meant that PM Modi had promised to nearly double (1.85 times) India’s dollar GDP in five years (from 2018-19). This required a CAGR of 13.12 percent.

While India had achieved such high growth in some patches between 1990 and 2013, it was way higher than Modi 1.0's track record (7.51 percent) and growth assumed for the $10 trillion goal (8.5 percent).

I presented the underlying assumptions in a meeting chaired by PM Modi to discuss the regular Budget for 2019-20 to be presented in July. As the goal of a $5 trillion GDP by 2024 had been publicly announced, I suggested interpreting 2024 as the financial year 2024-25, which was accepted.

Finance minister Nirmala Sitharaman announced, in the 2019-20 Budget, India’s ambition to become a $5 trillion economy by 2024-25. This required an annual growth of 10.82 percent, a bit tough but doable.

Modi 2.0 Failed Miserably

The GDP data in current US dollars, for all countries, are published by the International Monetary Fund regularly. In its latest published Economic Outlook Database (April 2026), the IMF data discloses that India’s GDP grew to $3.50 trillion in 2023-24 and $3.76 trillion in 2024-25.

In six years, India added $1.11 trillion to its GDP of $2.65 billion in 2018-19 at a CAGR of only 5.98 percent, not even half of the required $2.35 trillion.

It was an unqualified failure.

In a reply to an unstarred question, the government denied that PM Modi had ever promised to make India a $5 trillion economy.

Not Impossible, But Unlikely

The Prime Minister does not mention the $5 trillion GDP goal anymore. Ministers, officers, the Chief Economic Advisor (CEA) and government spokespersons still do, shifting the goalpost from time to time.

On 4 January 2022, CEA Anantha Nageswaran predicted that India would become a $5 trillion economy by 2026-27. On 29 May 2025, he expressed confidence that India was on track to become a USD 5 trillion economy by 2027-28.

India is not, however, on track to become a $5 trillion economy even by 2028-29, when Modi 3.0 will come to an end.

India’s GDP for 2025-26 has been estimated at $3.916 trillion by the IMF in April 2026, more than a trillion dollars shy of the $5 trillion mark.

In seven years since 2018-19, India’s dollar GDP growth has been only 5.72 percent; in the two years of Modi 3.0, it was 5.77 percent.

To reach $5 trillion in 2028-29, three years from now, India needs to record dollar GDP growth of 8.49 percent annually. It is not an impossible task but unlikely.

India has recorded nominal rupee GDP growth of about 9 percent in last two years. As inflation is looking up, India may witness 10 percent to 11 percent nominal GDP growth in the remaining three years of Modi 3.0.

India, however, has been witnessing sharp rupee depreciation for last two years.

In 2025-26, the rupee depreciated by about 10 percent. Such a massive depreciation neutralised the entire nominal growth.

It is quite likely that the rupee will witness depreciation of about 5-6 percent per annum in the coming three years, reducing the dollar GDP growth to 5-6 percent, which it has achieved for the last few years.

PM Modi’s promise of $5 trillion economy by 2024-25 is not going to fructify even by 2028-29.

The Third-Largest Economy Guarantee Will Also Fail

On 19 December 2023, and many times thereafter, including in the Parliament, PM Modi wowed and guaranteed to make India the third-largest economy in the world by the time his third term ends in 2029.

His guarantee was based on what the IMF was projecting for quite some time.

For years, the IMF has projected high GDP growth for India and slower growth for Germany and Japan—the two economies ranked between India, which was fifth globally in 2023–24, and the US and China in first and second place, positions that remain well beyond India’s reach.

In its April 2026 Outlook, the IMF projects India’s GDP to reach $5.059 trillion by 2028–29, assuming an annual CAGR of 8.91 percent, which appears optimistic.

Over the same period, it expects Germany and Japan to grow at CAGRs of 4.85 percent and 2.27 percent, respectively, projecting Germany’s GDP at $5.81 trillion and Japan’s at $4.74 trillion by 2028 (corresponding to India’s 2028–29).

The IMF also no longer projects India to overtake Germany by the end of Modi 3.0.

India was recently overtaken by United Kingdom and got relegated to the sixth spot in 2025-26. If we assume India’s dollar growth at 6 percent per annum, India’s GDP will rise to $4.66 trillion in 2028-29, less than the IMF’s projected Japan’s GDP of $4.74 trillion.

India is unlikely to overtake Japan as well. So, India will likely rise to the fifth place at best in 2028-29, falsifying the guarantee of PM Modi.

The Viksit Bharat Bandwagon

PM Modi has now shifted gears to the bandwagon of Viksit Bharat for 2047. Unlike a $5 trillion GDP by 2024-25 or the third largest economy by 2028-29, there is no quantifiable and verifiable goal in the Viksit Bharat bandwagon.

Pegging it to 2047, about 25 years away from when it was first announced, is throwing accountability to the winds.

‘Viksit Bharat in 2047’ is actually ‘Achhe Din’ deferred to the long run, in which as Keynes famously said, ‘we are all dead’.

(Subhash Chandra Garg is the Chief Policy Advisor, SUBHANJALI, and Former Finance and Economic Affairs Secretary, Government of India. He's the author of many books, including 'The $10 Trillion Dream Dented, 'We Also Make Policy', and 'Explanation and Commentary on Budget 2025-26'. This is an opinion piece, and the views expressed above are the author’s own. The Quint neither endorses nor is responsible for the same.)