Gandhi, 66, described as "de facto head of India", is ranked 21st among the world's 72 most powerful. She takes the third spot after German Chancellor Angela Merkel (No.5) and Brazil's Dilma Rousseff (No. 20) among the nine women, more than ever before.
Indian Prime Minister Manmohan Singh, 81, takes the 28th spot with two other Indians, Reliance Industries chairman Mukesh Ambani, 56, ranked 38th, and ArcelorMittal chairman and CEO Lakshmi Mittal, 63, in the 51st position.
While Putin climbs to the top spot as he "continues to solidify control over Russia and the international stage", Obama drops to second spot with his "lame duck period (has) seemingly set in earlier than usual for a two-term president".
Obama is followed by Communist Party of China general secretary Xi Jinping (No. 3), Pope Francis (No.4) and Merkel (No. 5).
Rounding out the Top 10 are Bill and Melinda Gates Foundation co-chair Bill Gates (No. 6), US Federal Reserve chairman Ben S. Bernanke (No. 7), Saudi King Abdullah bin Abdul Aziz (No. 8), European Central Bank president Mario Draghi (No.9) and the highest ranking active businessperson on the list - Wal-Mart CEO Michael Duke (No. 10).
British Prime Minister David Cameron (No. 11) dropped out of the Top 10 to take the 11th spot.
Among the 13 newcomers to the list (and new to their positions) are Pope Francis (No. 4), China Investment Corp chairman Ding Xuedong (No. 36) and Governor of the Bank of Japan Haruhiko Kuroda (No. 39).
Forty percent (or 26 people) on the list are billionaires, with their combined net worth totalling $564.1 billion - more than the GDP in Sweden, according to The World Bank Group.
Four are from India and four from China. Facebook CEO Mark Zuckerberg (No. 24) and North Korean leader Kim Jong-un (No. 46) are the youngest on the list, at ages 29 and 30 respectfully.