India’s Economic Growth Forecast Adjusted Downward by UN
India’s Growth Slows, But Still Strong: UN Report
India’s economic growth is expected to moderate in 2025, but it will still be one of the fastest-growing large economies globally. The United Nations has revised its forecast for India’s GDP growth to 6.3% for 2025, down from 7.1% in 2024.
Despite Challenges, India’s Economy Remains Resilient
The UN’s report, titled ‘The World Economic Situation and Prospects as of mid-2025,’ highlights that India’s economy continues to be supported by strong private consumption and public investment. Robust services exports are also expected to contribute to growth.
While the report acknowledges that looming US tariffs could impact merchandise exports, sectors like pharmaceuticals, electronics, and energy currently exempt from tariffs could help mitigate the economic impact.
Global Economic Outlook Dimmed
This downward revision for India’s growth comes as the UN paints a more cautious picture of the global economy. Global GDP growth is now projected at just 2.4% in 2025, down from 2.9% in 2024.
The report cites heightened trade tensions, elevated policy uncertainty, and the recent surge in tariffs as major factors contributing to the slowdown. These challenges are especially concerning for vulnerable developing countries, which could face significant setbacks in their growth and development.
India’s Inflation and Monetary Policy
On a positive note, the report indicates that inflation in India is expected to slow down from 4.9% in 2024 to 4.3% in 2025, remaining within the central bank’s target range. This has allowed the Reserve Bank of India to begin its easing cycle in February 2025.
Looking Ahead
The UN report emphasizes the need for strengthening multilateral cooperation to address the global economic challenges. Revitalizing the rules-based trading system and providing targeted support to vulnerable countries are crucial for fostering sustainable and inclusive development.
