Will India Become an Upper Middle-Income Country by 2030?
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Synopsis
India is on track to achieve a per capita income of $4,000 by 2030, potentially classifying it as an upper middle-income nation. A recent SBI Research report highlights India's rapid economic growth and the factors influencing its journey towards this milestone.
Key Takeaways
- India is projected to reach $4,000 per capita income by 2030.
- It will join China and Indonesia in the upper middle-income classification.
- The country achieved $3 trillion in 2021.
- Continuous reforms are essential for sustained growth.
- Historical growth rates support the feasibility of reaching these targets.
New Delhi, Jan 19 (NationPress) India is projected to reach a per capita income of $4,000 by 2030, marking its transition to an upper middle-income country, alongside China and Indonesia in the current classification, according to a report from SBI Research released on Monday.
It took India 60 years post-independence to reach the milestone of $1 trillion, and just another seven years to achieve $2 trillion in 2014.
The nation reached $3 trillion in 2021, with projections suggesting it will achieve $4 trillion by 2025.
"India is expected to hit the $5 trillion mark within the next two years. The country achieved $1,000 in per capita income in 2009, 62 years after independence. It reached $2,000 in 2019 and is likely to hit $3,000 by 2026," stated Dr. Soumya Kanti Ghosh, Group Chief Economic Advisor at State Bank of India.
Over the past decade, India's ranking in the cross-country distribution of average real GDP growth has risen from the 92nd percentile to the 95th percentile, indicating a significant improvement in its global growth standing.
"To meet the high-income country threshold of $13,936 by 2047, India’s per capita GNI must grow at a CAGR of 7.5%. Given that India's per capita GNI has grown by 8.3% over the past 23 years, this target seems attainable," Ghosh elaborated.
However, if the high-income threshold rises to $18,000, India would need to achieve a CAGR of approximately 8.9% over the next 23 years to attain that status by 2047.
The report projects that with an average population growth of 0.6% and an average deflator of 2% from economies like China, Japan, the UK, the US, and the Euro area, nominal GDP growth in dollar terms is estimated to be around 11.5% for the next 23 years.
"India must continue its reform initiatives to secure the necessary incremental growth needed to enter the high-income category," the report advised.
Clearly, India can and is likely to transition to an upper middle-income country, with the threshold for this being around $4,500 in per capita GNI.
The required nominal GDP growth of about 11.5% is feasible, as historical growth rates were close to 11% prior to the pandemic (FY04-FY20) and around 10% during FY04-FY25.
Point of View
It's crucial to recognize that India's economic trajectory is not just a statistic; it's a reflection of ongoing reforms and resilience. The journey to becoming an upper middle-income nation is a testament to India's potential and determination. We must stay informed and engaged as this narrative unfolds.
NationPress
20/01/2026
Frequently Asked Questions
What is the current per capita income of India?
As of now, India's per capita income is projected to reach $4,000 by 2030.
When did India achieve its $3 trillion economy status?
India achieved its $3 trillion economy status in 2021.
What is the expected growth rate for India's GNI to become a high-income country?
India's per capita GNI must grow at a CAGR of 7.5% to reach the high-income threshold of $13,936 by 2047.
What reforms are necessary for India's economic growth?
India needs to continue its reform agenda to secure incremental growth essential for entering the high-income bracket.
How does India's GDP growth compare globally?
India's percentile rank in global GDP growth has increased from the 92nd to the 95th percentile over the last decade.
