India Near Upper Middle Income Status as Economy Surges

India is on course to become an upper middle income country by the end of this decade, with per capita income rising steadily and overall economic size expanding rapidly. An analysis by “State Bank of India” indicates that India’s gross national income (GNI) per capita is likely to reach $4,000 by 2030, placing it alongside countries such as China and Indonesia under the “World Bank” income classification.

World Bank Income Classification Explained

The World Bank categorises economies into four groups—low income, lower-middle income, upper-middle income, and high income—based on per capita GNI measured in US dollars. The upper-middle-income threshold currently lies around $4,000–$4,500. Global data show a steady rise in the number of upper-middle- and high-income economies since 1990, reflecting long-term income convergence across developing regions.

India’s Long Transition in Per Capita Income

India’s income transition has been gradual but consistent. It took nearly six decades for the country to move from low income to lower-middle income status in 2007. Per capita GNI rose from about $90 in the early 1960s to nearly $1,000 by 2009, doubled to $2,000 by 2019, and is projected to touch $3,000 by 2026. According to SBI estimates, the $4,000 milestone by 2030 appears achievable given recent growth trends.

Rapid Expansion of Economic Size

India’s overall economic scale has accelerated sharply over the past decade. After reaching the $1 trillion mark after six decades, the economy doubled to $2 trillion within seven years and crossed $4 trillion by 2025. Current projections suggest India could overtake Germany to become the world’s third-largest economy by 2028, behind the United States and China.

Imporatnt Facts for Exams

• World Bank classifies countries using per capita GNI in US dollars.
• Upper-middle-income threshold is around $4,000–$4,500 per capita.
• India became a lower-middle-income country in 2007.
• India is projected to be the third-largest economy by 2028.

Path Ahead and High-Income Aspirations

SBI notes that India’s relative growth ranking has improved significantly, placing it among the fastest-growing major economies globally. Looking ahead to 2047, India’s ambition to reach high-income status would require sustained per capita GNI growth of 7.5–9%, depending on future threshold revisions. While challenges such as inequality and productivity remain, current trends strongly support India’s transition to the upper-middle-income category in the near term.