As global trade tensions rise and major economies confront slower growth, India continues to distinguish itself as a key driver of global economic momentum. The International Monetary Fund’s October 2025 World Economic Outlook projects India’s GDP to grow at 6.6% in 2025, outpacing most major economies despite the headwinds created by new U.S. tariff measures.

A Shifting Global Landscape

The broader global economy is expected to weaken, with growth easing from 3.3% in 2024 to 3.2% in 2025. The IMF attributes this slowdown to increasing protectionism, disrupted trade flows, and reduced investment confidence. The world’s largest economies the United States, the Euro Area, and China are experiencing cooling manufacturing activity, softer exports, and persistent inflation pressures.

Why India Is Holding Steady

India’s resilient outlook stands in contrast to these trends. According to the IMF, three core factors are supporting India’s strong performance:

  • Robust domestic consumption that continues to anchor economic activity

  • A vibrant services sector that remains a vital engine of growth

  • Stable and predictable macroeconomic policies, which reinforce investor confidence

These strengths have helped India absorb the impact of higher U.S. tariffs and broader trade frictions more effectively than many other emerging markets.

India’s performance offers important insights for organizations and policymakers navigating today’s complex global environment:

  • Domestic market depth matters. Economies with strong internal demand are better positioned to withstand external shocks.

  • Policy stability drives confidence. Predictable monetary and fiscal frameworks attract investment and support long-term growth.

  • Agility in trade and supply chains is now essential. As global trade routes and policies shift, adaptability becomes a key competitive advantage.

    Source: EconomicTimes