India displaced Australia as the number two team in the ICC's One-Day Rankings after New Zealand defeated the World champions by six wickets in the second ODI in Melbourne on Friday to take a 2-0 lead in the five-match series.
Chasing 226 for victory after winning the toss and electing to field, the Kiwis rode on a 61 off 75 balls from Grant Elliott to coast home with seven balls to spare.
Ross Taylor (47) and Brendon McCullum (43) also made significant contributions towards the Kiwi cause.
Earlier, captain Michael Clarke, opening the innings for the Aussies, scored a painstaking 98 off 133 balls to rally the hosts after they were tottering at 63 for 3.
He and Michael Hussey (75) put on 133 runs for the fourth wicket to enable Australia put up a respectable total.
India, who have made steady upward progress after a winning streak of nine consecutive ODI triumphs, now have 122 rating points, just three behind top-rankers South Africa.
The Proteas recently climbed to the top of the table at Australia's expense.
Australia (121) have been pushed to third place while New Zealand follow in fourth with 117 points.
Pakistan is further down the ladder at fifth while England and Sri Lanka are sixth and seventh respectively.
Australia, who have been on the decline in the last few months, have just about managed to retain their place as the number one team in the longer version of the game despite losing the Test series at home to South Africa.
South Africa and India are now the top challengers to Ricky Ponting's team in both the versions.
In the ICC Test Rankings, Australia have 126 points. Second-placed South Africa (121) will get a chance to topple them when they take on Ponting's men in a home series later this month.
India are placed third with 118 points.
The number one ODI team on April 1 will be richer by US $175,000. The second-placed team gets US $75,000.