India is poised to become the third-largest economy in the world by 2029 following an investor-friendly business environment, Harsh Malhotra, Union Minister of State, Ministry of Corporate Affairs, and Road Transport and Highways.

"India has witnessed and achieved remarkable growth in each and every sector of the economy. Investor friendly business environment, which has resulted in India becoming the fifth largest economy in the world, and is on the track of becoming the third largest economy by 2029," Malhotra said.

The minister was speaking at the India-Japan Economy and Investment Forum 2025 on Friday at the national capital.

India is likely to become the third-largest economy by FY28, overtaking both Japan and Germany, according to EY which also said that India’s GDP is expected to reach $5.2 trillion, surpassing the $5 trillion ambition.

The major reasons propelling India's growth are robust public investment, capex pushed by the government, sustained growth in the business, consumer confidence and strong service sector," Malhotra said.

Further, he said infrastructure and transformative growth remained as a hallmark of the previous decade.

"Prime Minister Narendra Modi has played a pivotal role in India's infrastructure development through various initiatives, which has been instrumental in driving India's overall development with a focus on enhancing connectivity, promoting economic growth and improving the quality of life of the citizens."

Government, according to him, is further dedicated to creating a world class infrastructure with the launch of large scale projects ranging from world class roads, airports, trains, ports to increasing digital connection and updating urban infrastructure.

The National Logistics Policy advises to reduce the cost of logistics in India to be comparable to the global benchmark by 2030, and the government aims to be among top 25 countries by in the logistics performance index.

The government has emphasized the importance of digital infrastructure with initiatives like Startup India, Make in India, promoting innovation and entrepreneurship."

India's digital transformation, according to Malhotra, too has a profound impact on ease of doing business for corporates, and India is on the path of becoming the world leader in digital payment with more than 40% of the global real-time digital payments taking place in India.

During the G20 presidency last year, India showcased digital public infrastructure or DPI, with several countries expressing interest in adopting it.

The Global Digital Public Infrastructure Repository (GDPIR) is designed to be a resource for knowledge sharing with G20 members and guest countries.