Context:

India is poised to lead the global economy once again, with the International Monetary Fund (IMF) projecting it to remain the fastest growing major economy over the next two years. According to the April 2025 edition of the IMF’s World Economic Outlook, India’s economy is expected to grow by 6.2 per cent in 2025 and 6.3 per cent in 2026, maintaining a solid lead over global and regional peers.

World Economic Outlook Report:

The World Economic Outlook (WEO) is the International Monetary Fund’s key report on global economic trends and policy challenges. Published twice a year with interim updates, it provides projections for the near and medium term, covering advanced, emerging, and developing economies.

·        According to the April 2025 edition after several years of overlapping shocks, the global economy has entered a phase of cautious stabilisation.

·        Growth remains modest and projections for global output have been revised downward from the January 2025 update. This reflects a steep rise in tariff rates, policy uncertainty, and slowing progress in international cooperation.

·        Global inflation is expected to decline, although at a slower pace than previously anticipated, and downside risks such as trade tensions and volatile financial markets continue to weigh on the outlook.

Report for India:

·        For India, the growth outlook is relatively more stable. The IMF projects steady expansion of the Indian economy, supported by firm private consumption, particularly in rural areas.

·        In a global environment marked by uncertainty and subdued growth, India’s resilience stands out, reinforcing its role as a key driver of global economic activity. India is projected to remain the fastest-growing large economy for 2025 and 2026, reaffirming its dominance in the global economic landscape.

·        The country’s economy is expected to expand by 6.2 per cent in 2025 and 6.3 per cent in 2026, outpacing many of its global counterparts. The IMF projects global economic growth to be much lower, at 2.8 per cent in 2025 and 3.0 per cent in 2026, highlighting India's exceptional outperformance.

Report for Major Economies:

China’s GDP growth forecast for 2025 has been downgraded to 4.0 per cent, down from 4.6 per cent in the January 2025 edition of the World Economic Outlook. Similarly, the United States is expected to see a slowdown, with its growth revised downward by 90 basis points to 1.8 per cent.

Conclusion:

India’s economic outlook for 2025 and 2026 remains one of the brightest among major global economies, as highlighted by the IMF. Despite global uncertainties and downward revisions in growth forecasts for other large economies, India is set to maintain its leadership in global economic growth. Supported by strong fundamentals and strategic government initiatives, the country is well-positioned to navigate the challenges ahead.