India is firmly on track to transition into an upper-middle-income country by 2030, coinciding with its rise to become the world’s third-largest economy by 2028, according to the latest report by SBI Research.
The report underscores a sharp acceleration in India’s growth trajectory over the past decade, placing the country in the 95th percentile of the global growth distribution for the decade ended 2024.
SBI Research also said India is likely to achieve $5 trillion in two years.
“India took 60 years to transition to lower-middle income in 2007 from low-income country. Its per-capita GNI increased from $90 in 1962 to $910 in 2007, a CAGR of 5.3%. India also achieved $1 trillion in 60 years. India took 60 years since independence to reach $1 trillion. India achieved $2 trillion/ another 7 years in 2014. India achieved $3 trillion in another 7 years in 2021. India achieved $4 trillion in another 4 years in 2025. India is likely to achieve $5 trillion in another around 2 years,” according to the report.
India achieved $1,000 per capita income in 62 years since independence in 2009. India achieved $2,000 per capita / another 10 years in 2019. India to achieve $3,000 per capita in another 7 years in 2026. India set to touch $4,000 per capita in another 4 years in 2030 to transition to an Upper Middle Income country and join China and Indonesia at current classification, it added.
The report draws on the World Bank classification of countries based on gross national income (GNI) per capita, which shows a steady upward mobility of nations across income categories between 1990 and 2024. During this period, the number of high-income countries rose from 39 to 87, while low-income countries nearly halved from 51 to 26, indicating broad-based global income progression.
A comparative analysis of 48 low- and middle-income countries in 1990 that successfully transitioned to higher income categories highlights Guyana as the standout performer. Guyana moved from a low-income country in 1990 to a high-income country by 2024, with its per capita GNI rising more than 51 times from $390 to $20,140. China and Indonesia also made significant progress during this period. China, with a per capita GNI of just $330 in 1990, is now classified as an upper middle-income country, while Indonesia has similarly transitioned from low-income to upper middle-income status.
“Analysis of 48 low- and middle-income countries in 1990 which have performed well and transitioned to higher income category shows that Guyana has been the best performer with transition made from low-income country in 1990 to high income country in 2024 and corresponding per capita GNI increasing more than 51 times during the period (from $390 to $20,140). China which had $330 per capita GNI in 1990 (a low-income country) and it is now an upper middle-income country in 2024. Even Indonesia has transitioned from low-income country to upper middle-income country during the period,” SBI Research said in the report.
“India’s growth journey in the last decade shows that India’s percentile rank in the cross-country distribution of average real GDP growth has increased from the 92nd percentile over a 25-year horizon to the 95th percentile implying a rightward shift in its relative position that places India deeper into the upper tail of the global growth distribution. If we consider the current per capita GNI threshold for high income country of $13,936 to be reached by 2047 (as per Viksit Bharat vision), India’s per capita GNI has to grow by a CAGR of 7.5%. This seems achievable as India’s per capita GNI has grown by a CAGR of 8.3% during the last 23 years (2001-2024),” SBI Research stated.
The SBI Ecowrap projects that India will touch around $4,000 per capita income by 2030, enabling its transition to an upper middle-income country, joining peers such as China and Indonesia under the current World Bank classification.
The report highlights a marked improvement in India’s relative growth performance globally. India’s percentile rank in the cross-country distribution of average real GDP growth has risen from the 92nd percentile over a 25-year horizon to the 95th percentile in the most recent decade, indicating a clear rightward shift that places the country deeper into the upper tail of the global growth distribution.
Looking ahead to the government’s long-term Viksit Bharat vision, the report assesses the feasibility of India becoming a high-income country by 2047. If the current high-income threshold of $13,936 per capita GNI were to remain unchanged, India would need to grow its per capita GNI at a CAGR of about 7.5%. This appears achievable, given that India’s per capita GNI has already grown at a CAGR of 8.3% during 2001–2024.
However, the threshold itself is likely to rise. If the high-income benchmark increases to around $18,000 by 2047, India would need a higher per capita GNI growth rate of nearly 8.9% over the next 23 years. Assuming average population growth of 0.6% and an average inflation deflator of about 2%, in line with advanced economies such as China, Japan, the US, the UK and the Euro area, this would translate into nominal GDP growth in dollar terms of around 11.5% annually.
The SBI Ecowrap notes that such growth rates are not unprecedented for India. Nominal GDP growth in dollar terms averaged around 11% in the pre-pandemic period between FY04 and FY20 and about 10% during FY04-FY25. This strengthens the case that India’s transition to an upper middle-income country, with a per capita GNI threshold of roughly $4,500, is not only likely but imminent.
Globally, the shifting income distribution reflects sustained economic progress across regions. In 1990, of the 218 countries classified by the World Bank, 51 were low-income, 56 lower middle-income, 29 upper middle-income and 39 high-income. By 2024, the composition had changed significantly, with only 26 low-income countries, 50 lower middle-income, 54 upper middle-income and 87 high-income economies.
Against this backdrop, India’s ascent stands out both in scale and speed. With the US remaining the world’s largest economy and China second, India is projected to overtake Germany to become the third-largest economy by 2028. The SBI report said that continued structural reforms and sustained high growth will be critical for India to not only secure its upper middle-income status by the end of this decade but also lay the groundwork for its eventual transition into a high-income economy by 2047.
