Forbes said PM Modi "presided over 7.4% GDP growth in his first year in office."
Prime Minister Narendra Modi has been ranked ninth on the Forbes list of powerful people for 2015, up six places from last year when he was at number 15. He is placed between his host next week, UK Prime Minister David Cameron, at number eight and Google's Larry Page at 10.
Russian President Vladimir Putin retains his place as the world's most powerful, while US president Barack Obama has slipped one place to number three. At number two this year is German Chancellor Angela Merkel.
Last year's number three on the Forbes list, China's Xi Jinping, is ranked fifth this year, after Pope Francis at number four. The pope retains his position from 2014.
Forbes said PM Modi "presided over 7.4% GDP growth in his first year in office, and raised his profile as a global leader during official visits with Barack Obama and Xi Jinping. A barnstorming tour of Silicon Valley reinforced his nation's massive importance in tech."
"But governing 1.2 billion people requires more than shaking hands: Now Modi must pass his party's reform agenda and keep fractious opposition under control," it also said.
Putin, Forbes said, "continues to prove he's one of the few men in the world powerful enough to do what he wants - and get away with it."
US President Obama had slipped a place, it said, as "it's clear his influence is shrinking, and it's a bigger struggle than ever to get things done. At home, his approval ratings are perpetually stuck under 50%; abroad, he's outshined by Merkel in Europe, and outmaneuvered by Putin in the Middle East."
Microsoft's Bill Gates and US Federal Reserve Chair Janet Yellen are the others who feature in the top 10.
Facebook's Mark Zuckerberg, 31, is the 19th most powerful person in the world, according to Forbes.
New members of the list include Dell CEO Michael Dell (number 59); China's richest man, Wang Jianlin (number 68); newly elected Canadian Prime Minister Justin Trudeau (number 69); billionaire activist investor Carl Icahn (number 70); and US Presidential candidate Donald Trump (number 72).