In its latest Global Economic Outlook, the International Monetary Fund (IMF) has raised its projection for India’s economic growth in 2025 to 6.6%, a positive uptick of 0.2 percentage points. The report suggests that India’s robust economic activity in the first quarter of 2025 is significantly helping to absorb the impact of recent US tariff increases on imports.
This upward revision for 2025 is a key highlight, though the IMF does project a slightly slower growth of 6.2% for 2026, a decrease of 0.2 percentage points from earlier estimates. India’s economy had previously demonstrated remarkable strength, achieving a growth rate of 7.8% in the April-July quarter. This performance has earned praise from the IMF, with Kristalina Georgieva specifically lauding India’s bold policy initiatives and digital transformation efforts.
The World Bank has also recently upgraded its growth forecast for India, underscoring a favorable economic climate. The IMF forecasts a modest global growth of 3.2% for the current year. While trade tensions and tariffs are a factor, the IMF believes their impact has been somewhat mitigated by strategic trade measures and the business sector’s ability to adapt supply chains and front-load imports. Nonetheless, the IMF cautions that these ‘tariff shocks’ continue to pose a risk to global economic momentum, impacting even developed economies like the United States.