Indian Thought Latest News & Views
New Delhi: The International Monetary Fund (IMF) has delivered good news for India’s economy. In its latest World Economic Outlook (WEO) report, the IMF has raised India’s GDP (GDP g) growth forecast for 2025-26 from 6.4% to 6.6%. This revision is evidence of India’s economy maintaining strong momentum, even withstanding the impact of new tariffs imposed by the US on Indian exports.
Strong start boosts confidence.
According to the IMF report, India’s economy recorded a robust growth of 7.8% in the April-June quarter, the best performance in the last five quarters. This enthusiasm and momentum mitigated the impact of US tariffs. The IMF stated, “Our forecast for 2025 is better than previously.” A strong start to the first quarter offset the impact of tariffs, although the 2026 forecast has been slightly reduced. Strong domestic demand in India, a booming manufacturing sector, and the government’s capital expenditure policies have maintained this momentum.
World Bank also raised its forecast
Earlier this month, not just the IMF, the World Bank also raised its GDP forecast for India for the current fiscal year (2024-25) from 6.3% to 6.5%. The World Bank says India will remain the world’s fastest-growing major economy in the near future. This is a major achievement for India, which is demonstrating its strength even amid global economic challenges. While the IMF raised its forecast for 2025-26, it reduced GDP growth for 2026-27 from 6.4% to 6.2%. This slight reduction is due to uncertainties in global trade and other economic challenges. Previously, in its April 2025 report, the IMF projected growth of 6.2% for 2025 and 6.3% for 2026.
Global Economy Monitoring
The IMF also shared its projections globally. According to the report, global economic growth is expected to decline from 3.3% in 2024 to 3.2% in 2025 and 3.1% in 2026. This is slightly better than in July, but 0.2% lower than the earlier projections from October 2024. The IMF attributed this slowdown to protectionist policies, trade uncertainty, and macroeconomic challenges. Growth in emerging and developing countries is also expected to decline from 4.3% in 2024 to 4.2% in 2025 and 4% in 2026. These projections from the IMF and World Bank reflect India’s economic strength. Despite global challenges, India’s strong performance and government policies are helping it remain the world’s fastest-growing economy.
