Highlights:
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SBI Research projects that India will enter the World Bank’s upper-middle-income category by around 2030.
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Estimates per capita GNI could approach $4,000 within the next four years.
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SBI Research expects India to become the world’s third-largest economy by 2028.
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Reaching high-income status by 2047 will require sustained per capita income growth of 7.5–9 percent, according to SBI.
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SBI highlights that long-term reforms and strong nominal GDP growth will be critical to meeting future income thresholds.
India is positioned to achieve a significant economic milestone over the coming decade, according to a new report by SBI Research. The report states that India is likely to transition into the World Bank’s upper-middle-income category by around 2030, supported by steady growth in per capita income and a macroeconomic foundation that has strengthened over the past two decades.
SBI on India’s Path to Upper-Middle Income Status
According to SBI Research, India’s per capita gross national income (GNI) is projected to reach close to $4,000 within the next four years. Crossing this level would place India firmly in the World Bank’s upper-middle-income group. SBI notes that this transition reflects the cumulative impact of economic reforms, rising productivity, and sustained growth in output and incomes.
India moved into the lower-middle-income category in 2007 after spending nearly 60 years classified as a low-income economy. SBI points out that this progression highlights the gradual nature of income classification changes, which often lag behind overall economic expansion. The SBI report emphasizes that income thresholds are updated periodically, but India’s underlying growth momentum remains strong enough to support the next upgrade.
SBI Research on India’s Expanding Economic Size
While per capita income is a key determinant of income classification, SBI Research underscores that India’s overall economic size is expanding at a faster pace. According to SBI projections, India could become the world’s third-largest economy by 2028. The report also estimates that India is likely to reach a $5 trillion gross domestic product during the 2027–28 period.
SBI attributes this expansion to robust domestic demand, higher investment activity, and structural reforms implemented across multiple sectors. Manufacturing, services, infrastructure, and digital adoption are cited by SBI as areas contributing to sustained economic growth. The report adds that India’s demographic profile and expanding consumer base continue to support medium-term growth prospects.
SBI Analysis of Long-Term Income Targets
Looking beyond 2030, SBI Research examines India’s prospects of achieving high-income status by 2047, which will mark 100 years of independence. Based on the current World Bank high-income threshold of $13,936 per capita GNI, SBI estimates that India would need to maintain a compound annual growth rate of about 7.5 percent in per capita income.
SBI notes that this target appears achievable when viewed against historical performance. Between 2001 and 2024, India’s per capita GNI grew at an average compounded rate of approximately 8.3 percent. According to SBI, this track record demonstrates that sustained high growth over long periods is possible, provided supportive policy conditions remain in place.
SBI Warns of Rising Income Thresholds
However, SBI Research cautions that World Bank income thresholds are not fixed. If the high-income benchmark rises to around $18,000 over the next two decades, India would need to accelerate per capita GNI growth to roughly 8.9 percent annually. SBI highlights that this scenario would demand stronger productivity gains and higher investment levels than currently observed.
Under this higher threshold scenario, SBI estimates that India’s nominal GDP growth in dollar terms would need to average around 11.5 percent annually. This calculation assumes average population growth of about 0.6 percent and a GDP deflator close to 2 percent. SBI stresses that meeting such growth requirements would require a combination of macroeconomic stability, export competitiveness, and continued integration into global value chains.
SBI on Reforms and Policy Consistency
The SBI report concludes that India’s transition into the upper-middle-income group by 2030 is highly likely. The more complex challenge, according to SBI Research, lies in sustaining the pace of reforms and productivity improvements needed to achieve high-income status by 2047.
SBI emphasizes that long-term policy consistency, human capital development, and structural transformation will play a decisive role in determining outcomes. Investments in education, healthcare, infrastructure, and technology adoption are identified by SBI as critical enablers of higher per capita income growth. The report also points to the importance of improving labor participation, boosting manufacturing competitiveness, and strengthening financial intermediation.
In its assessment, SBI Research underscores that India’s scale and growth momentum provide a strong foundation. Whether the country can convert these advantages into durable prosperity will depend on its ability to maintain reform momentum and adapt to changing global economic conditions over the next two decades.
