India has surpassed Japan to become the world's fourth-largest economy, according to calculations in the Indian government's end-of-year economic review. On current trends, India is expected to overtake Germany to become the world's third-largest economy within the next three years, the review said. How big is India's economy? The review said India's gross domestic product has already reached about $4.18 trillion (€3.55 trillion), and is projected to reach $7.3 trillion by 2030. On current trends, it said, India would trail only the United States and China in economic heft. India's real GDP grew 8.2% in the second quarter of the 2025–26 financial year, up from 7.8% in the previous quarter and marking a six-quarter high. Export performance has also strengthened, the review noted. Merchandise exports rose to $38.13 billion in November, up from $36.43 billion in January, supported by engineering goods, electronics, pharmaceuticals, and petroleum products. Official confirmation however depends on data due in 2026 when final annual GDP figures are released. The International Monetary Fund suggests India will surpass Japan next year. The Reserve Bank of India has revised its growth forecast for the 2025–26 financial year upward to 7.3%. Why might India's economy be booming? Growth was said to have been driven primarily by domestic demand, with particularly strong private consumption, despite continued global trade and policy uncertainty. The government described the current phase as a rare "Goldilocks" period of high growth and low inflation, saying strong corporate balance sheets, steady credit flows, and ongoing reforms have positioned India for sustained expansion. "India is among the world's fastest-growing major economies and is well-positioned to sustain this momentum." "With the ambition of attaining high middle-income status by 2047 — the centenary year of its independence — the country is building on strong foundations of economic growth, structural reforms, and social progress." What economic challenges does India face? In income terms, the gap with advanced economies remains wide. India's GDP per capita stood at $2,694 in 2024, according to the latest World Bank data—about 12 times lower than Japan's $32,487 and roughly 20 times below Germany's $56,103. By population, India overtook neighboring China in 2023 to become the world's most populous country. Government figures show that more than a quarter of India's 1.4 billion people are aged between 10 and 26. Creating enough well-paid jobs for millions of young graduates is an upcoming hurdle, but the report offered a rosy outlook. "As one of the world's youngest nations, India's growth story is being shaped by its ability to generate quality employment that productively absorbs its expanding workforce and delivers inclusive, sustainable growth," a note in the review said. Prime Minister Narendra Modi this year unveiled sweeping consumption tax cuts and pushed through labor law reforms after growth slowed to a four-year low in the 12 months ending March 31. Currency pressures have also mounted. The rupee hit a record low against the dollar in early December, after falling about 5% in 2025. That came amid concerns over the lack of a trade deal with Washington and the impact of higher levies on Indian goods. India became the world's fifth-largest economy in 2022, when its GDP overtook that of former colonial ruler Britain, according to IMF figures.

Indian Prime Minister Narendra Modi has expressed deep condolences following the passing of BNP Chairperson and former Prime Minister Begum Khaleda Zia. In a message shared on social media on Tuesday (December 30), Prime Minister Modi stated that he was "deeply saddened" by the news of her demise. "Deeply saddened to learn about the passing away of former Prime Minister and BNP Chairperson Begum Khaleda Zia in Dhaka," he wrote. "Our sincerest condolences to her family and all the people of Bangladesh. May the Almighty grant her family the fortitude to bear this tragic loss." He further added, "As the first woman Prime Minister of Bangladesh, her important contributions towards the development of Bangladesh, as well as India-Bangladesh relations, will always be remembered." Read More CA Expresses Deep Grief Over the Death of Khaleda Zia The Indian Prime Minister also took a moment to reflect on their personal interactions: "I recall my warm meeting with her in Dhaka in 2015. We hope that her vision and legacy will continue to guide our partnership. May her soul rest in peace." Global Condolences Pour In Prime Minister Modi's message is part of a wave of international tributes following the death of the 80-year-old leader, who passed away at 6:00 AM today at Evercare Hospital in Dhaka. Earlier this morning, world leaders including Pakistan's Prime Minister Shehbaz Sharif and the United States Embassy in Dhaka also extended their deepest sympathies, acknowledging Khaleda Zia's pivotal role in shaping the modern history of Bangladesh.

The Indian space agency on Wednesday launched a LVM-3 rocket carrying its heaviest-ever satellite — BlueBird Block-2 — from the Satish Dhawan Space Centre in southern India. BlueBird Block-2 weighs 6,100 kilograms (over 6 tons), making the largest-ever commercial communications satellite to be deployed in low Earth orbit (LEO) and "the heaviest payload to be launched from Indian soil," according to the space agency. The LVM3-M6 rocket, built by the US-based company AST SpaceMobile, was launched at 8.55 a.m. local time (0330 GMT). The satellite was successfully injected into the intended orbit, ISRO said. India stepping up its space ambitions ISRO plans to use a modified version of the LVM-3 rocket for its future space missions, including the human spaceflight program, Gaganyaan mission. The milestone launch was lauded by the Indian Prime Minister Narendra Modi as "a significant stride" for the space sector. "It strengthens India's heavy-lift launch capability and reinforces our growing role in the global commercial launch market," he said in a statement. India is trying to secure its place in the commercial satellite business as its phone, internet and other companies seek to expand and improve communications. The country is also preparing an unmanned mission to the moon ahead of its fist human spaceflight, which set for 2027.

In a continuing cycle of diplomatic friction, the Indian Ministry of External Affairs (MEA) summoned Bangladesh High Commissioner M. Riaz Hamidullah to New Delhi on Tuesday (December 23). The move came just hours after Dhaka summoned the Indian envoy to protest recent security breaches at its diplomatic missions in India. This marks the fourth time in 10 days that the two neighboring nations have summoned each other’s top diplomats to register formal protests and concerns. Escalating Tensions over Mission Security The day’s diplomatic maneuvers began in Dhaka, where the Bangladesh Ministry of Foreign Affairs summoned Indian High Commissioner Pranay Verma. During the meeting, Bangladesh expressed "deep concern" over several recent incidents in India: Protests in New Delhi: Demonstrations and alleged threats issued outside the Bangladesh High Commission and the High Commissioner's residence on December 20. Vandalism in Siliguri: An attack on the Bangladesh Visa Center in Siliguri on December 22, reportedly carried out by members of several Hindutva organizations. Delhi’s "Tea Invitation" Counter-Summons In a swift response, the Indian MEA summoned High Commissioner Hamidullah later that afternoon under the guise of an "invitation for tea." Diplomatic sources reveal that B. Shyam, Joint Secretary at the MEA, told the Bangladeshi envoy that Dhaka has recently been reacting to various issues in an "unreasonable and irrelevant" manner. High Commissioner Hamidullah reportedly refuted these allegations during the meeting, maintaining that Bangladesh’s positions are based strictly on "ground realities" and factual developments. Context of the Strained Ties Relations between the two countries have remained sensitive since the political transition in Bangladesh last August. The frequent summoning of diplomats highlights a period of significant mistrust, with both nations trading accusations regarding the safety of diplomatic personnel and the treatment of minorities.

The Pakistan-Afghanistan crisis and border closures are reshaping regional trade. India is capitalizing on the conflict by deepening economic ties and strategic engagement with Kabul. Relations between Pakistan and Afghanistan have hit a historic low in recent months, after deadly cross-border clashes that left dozens of people killed. Important trade routes like Torkham and Chaman have since been closed. This has crippled trade, spiked prices and deepened the rift. The closure of Pakistan's border crossings with Afghanistan has also triggered a significant realignment in regional trade patterns, with India emerging as the primary beneficiary. Pakistan-Afghanistan border crisis reshapes regional trade The conflict between Pakistan and Afghanistan has seen trade between the two neighbors collapse by nearly half. Bilateral commerce grew by 25% in the fiscal year 2024-25, reaching nearly $2 billion (€1.88 billion), according to multiple media reports in both countries. But with the border closures and military tensions, that has fallen to around $1 billion, Khan Jan Alokozay, a board member of Afghanistan's Chamber of Commerce, told Amu TV. It is a hugely impactful loss for a country whose exports were worth $992 million, and whose imports totaled $5.76 billion in 2022, according to the World Trade Organisation (WTO). Afghanistan pivots towards India With this critical commercial relationship severely disrupted, Afghanistan — largely shunned by the international community since the Taliban returned to power — is actively seeking alternative trade routes. New Delhi has moved to position itself as the solution. Afghan Commerce Minister Nooruddin Azizi recently traveled to New Delhi to negotiate expanded economic ties, including increased cargo flights to Kabul from Indian cities like Delhi, Amritsar, and Mumbai. Both sides also appointed trade attachés to their respective embassies to oversee and facilitate bilateral commerce. The discussions focused on tariff reductions, tax exemptions and a bilateral trade target of $1 billion, signalling Afghanistan's intent to fundamentally restructure its commercial relationships away from Pakistani ports and border crossings. Chabahar, India's strategic gateway Central to India's approach is Chabahar port in Iran, which provides landlocked Afghanistan with access to international waters — without having to cross Pakistani territory. India is investing heavily in the port, which serves as a pivotal sea route that bypasses Pakistan, facilitating essential imports for Afghanistan. Since relations between Pakistan and Afghanistan soured, Afghan traders have been shifting to use the port to import food, commodities, construction materials and consumer goods, essentials that previously came through Pakistan. "While the blockade continues, India must prioritize Chabahar port upgrades, which include container handling, storage and hinterland connectivity covering Chabahar-Zahedan rail, dry ports and faster customs," Ajay Bisaria, a former envoy to Pakistan, told DW. The recent US sanctions waiver granted in October for operations at Chabahar — which India is developing and expanding — removes a major constraint that had previously limited the port's commercial viability. "India must also leverage the US sanction waiver on Chabahar to offer speed and reliability advantages to counter Pakistan's cheaper routes. India's proactive measures of subsidies, digital clearance, logistics integration can ensure competitiveness even when the blockade lifts," added Bisaria, pointing out that the challenge is to move fast enough to create infrastructure and economic ties that make its routes competitive. Gautam Mukhopadhaya, a former ambassador to Afghanistan, also said the current Afghanistan-Pakistan blockade, however severe, presents India with a strategic opportunity. "If alternative routes through Chabahar Port can be normalized and made commercially viable, they could establish a sustainable bypass to Pakistan's unpredictable transit policies," Mukhopadhaya told DW. He emphasized that the conflict between Islamabad and Kabul has "created a window for India to consolidate its position as Afghanistan's primary trade gateway." But Mukhopadhaya added that "success depends on whether the Chabahar alternative can prove both reliable and profitable enough to overcome the inherent logic of the traditional land border." Indian investments in the port at Chabahar reportedly total around $370 million Challenges and uncertainty However, Afghanistan expert Shanthie Mariet D'Souza points out Chabahar requires significant logistical and equipment upgrades, including cranes and storage facilities, to handle the expected $2 billion-plus Afghan trade bypass. "Nevertheless, the most critical requirement is the activation of rail links, particularly along the Chabahar-Zahedan route. Unfortunately, several challenges can hinder this progress, with the most significant being the American sanctions on Iran," said D'Souza, president of Mantraya Institute for Strategic Studies think tank, told DW. "Given the uncertainty surrounding the duration of the trade blockade, addressing these logistical and systemic issues is likely to be difficult in the short to medium term," she added. Having already formalized and strengthened trade relations, D'Souza said India should now look to secure its long-term influence by framing its trade relationship with Afghanistan in a way that promotes Afghan self-reliance. "India enjoys goodwill among the Afghan populace, and its current amicable relations with the Taliban can facilitate this process, making it more resilient to future changes in Pakistan-Afghanistan relations," she said. Pragmatic engagement Although New Delhi does not formally recognize the Taliban regime, the two sides have deepened bilateral engagement in recent months, driven by both opportunity and necessity, especially against the backdrop of worsening India-Pakistan relations. D'Souza believes that if Pakistan lifts its current effective blockade and extends an olive branch to Kabul, Indian trade routes to Afghanistan would face increased competition. "However, considering the past instances of Pakistan using border closures as a strategic weapon to extract concessions from the Taliban, Afghanistan will be inclined to make a strategic shift towards a more reliable and diversified alternative," she said. For that to happen, India, Iran, and Afghanistan will have to find a way to mitigate the impact of Western sanctions on Tehran, which the United Nations reimposed in September. The US, meanwhile, has been sanctioning Iran for most of its history post-1979. "A success on (the sanctions) front would make these alternate routes a more permanent and reliable option rather than just a temporary solution," D'Souza said. However, T.C.A. Raghavan, a former Indian high commissioner to Pakistan, sounds a word of caution about India's window of opportunity with Chabahar. He warned against mistaking a temporary disruption for a permanent structural shift. "We must be cautious in assuming that Pakistan-Afghanistan trade disruption automatically creates opportunities for us to export to Afghanistan via Iran," Raghavan told DW. "There are severe infrastructure constraints plus issues such as US sanctions, all of which have acted to severely compress Indian exports to Iran over the past decade. This will apply to exports to Afghanistan also," he said. "I do not see the present impasse continuing for years. But at the same time, I don't think we will see rapid improvement in days or weeks," he added.