Defying global trade tensions and higher U.S. tariffs under President Donald Trump, India has received a boost from the International Monetary Fund (IMF), which upgraded the country’s growth forecast for 2025 to 6.6%, up from 6.4%.
The Fund credited India’s robust domestic consumption, sustained infrastructure spending, and steady private investment for the brighter outlook. The economy expanded by a faster-than-expected 7.8% in the first quarter of FY26, reaffirming its status as one of the world’s fastest-growing major economies.
Globally, the IMF expects growth to edge down to 3.2% in 2025 from 3.3% in 2024, as escalating trade frictions and weak demand weigh on both advanced and emerging markets. Yet India continues to stand out, far ahead of China, whose growth is projected to ease to 4.3%.
For 2026, the IMF slightly scaled back India’s forecast to 6.2%, cautioning that extended tariff disputes and global uncertainty could impact exports and investment flows. The Fund said sustaining India’s momentum will require continued reforms, strong fiscal management, and policies that foster productivity and innovation.
Economists view the outlook as a sign of resilience, a reflection of India’s expanding domestic market and manufacturing revival, which continue to anchor growth even amid a turbulent global landscape.
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