What makes India the happiest country in the world

India is the happiest country on the planet, finds Ipsos Happiness Index 2025, released on the occasion of International Day of Happiness. India’s happiness, as suggested by experts, might stem from its strong social fabric. Close-knit families, community support, and deep-rooted spiritual beliefs likely play a significant role. These factors provide a sense of belonging, purpose, and resilience, even in the face of any adversity.

Examining the Happiness scores within India, a few interesting themes and trends emerge. Generation Z (those born between 1996 to 2012) report higher levels of happiness across various life aspects compared to Millennials (born between 1981 and 1996) and Gen X (born during early 1960s to late 1970s). Ipsos India Happiness Monitor (covering Gen Z aged 18 yrs+) showcases consistently higher happiness scores across all aspects of life like health, finances, family and friends, job and colleagues (among those working).

As age progresses, happiness levels tend to decline—highlighting the impact of societal pressures and responsibilities. Factors like health (own and of family members), financial stability, work-life balance, etc, play a significant role in overall well-being.

While Gen Z faces unique challenges—being raised in a world dominated by the internet and social media, their ability to find joy in the simpler things, like video games and online communities, fosters a sense of belonging and support.

One of the key differentiators for Gen Z is their strong sense of purpose, particularly in their academic and professional lives. Finding meaning in their daily activities, pursuing passions, and contributing to society are crucial for their happiness. This generation thrives on engaging and stimulating experiences, seeking out opportunities for growth and learning.

While Gen Z might be navigating a complex world, their focus on purpose, meaningful experiences and inherent optimism of this life-stage contributes to their happiness. Understanding their values and priorities is crucial for fostering their well-being and creating an environment where they can thrive.

Gen Z: Women versus men

Among Gen Z, it is the men who are ‘happier’ across various aspects of life, as compared to women. This insight requires a macro lens of the situation women face in the Indian society. From a finance perspective there exist issues such as the gender pay gap, limited financial independence, or fewer opportunities for women in certain fields.

From a society perspective, women carry a larger burden of societal and familial expectations, and possible social restrictions. All these aspects seem to be limiting women's freedom and social interactions compared to men. This indicates that young women feel less secure and optimistic about their surroundings, as compared to men.

Happy wallet, happy economy

Personal finance is an important driver of an individual’s happiness as Ipsos India’s Happiness Report 2023 showed. Hence contentment or discontent with their financial situations can have a significant impact on their overall state of happiness.

Interestingly, happiness with personal finances also has a strong co-relation (Pearson Correlation coefficient = 0.78) with Consumer Confidence Index. Ipsos’ measure of the LSEG/Ipsos Primary Consumer Sentiment Index (PCSI), ongoing since 2010, is a monthly survey of consumer attitudes on the current and future state of their local economy, personal financial situation, savings, and confidence to make major investments.

When people feel financially secure, they are more likely to be optimistic about the economy as a whole, and be happy overall. Therefore, fostering financial well-being is not only crucial for individual happiness but also for creating a more optimistic and prosperous society.

Happiness and state of the world

The lowest scores on happiness are regarding ‘situation of the world’ with the Happiness Index at 53%, indicating that Indians are feeling apprehensive about the current global landscape.

This unease is hardly unfounded. The world today is grappling with a multitude of interconnected crises. Geopolitical tensions are simmering, climate change is accelerating, and economic uncertainty looms large.  For a nation like India, deeply integrated into the global economy and vulnerable to climate change impacts, these anxieties hit close to home.

The war in Ukraine, for instance, has sent shockwaves through global supply chains, impacting everything from fuel prices to food security.  Similarly, the increasing frequency of extreme weather events serves as a constant reminder of the environmental challenges that lie ahead.

This global uncertainty likely weighs heavily on the minds of Indians, impacting our sense of security and optimism about the future.  While the nation continues to make strides domestically, the turbulent global landscape presents a sobering counterpoint, reminding us that our individual and collective destinies are inextricably linked to the well-being of the wider world.

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