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BUSINESS & TRADE OCTOBER 31, 2025 | The Indian Eye 34

India’s Growth Story Holds Steady: GDP

Outlook Brightens Despite Global Headwinds

With the Reserve Bank of India and Deloitte both revising growth projections upward, the Indian
economy continues to demonstrate remarkable resilience amid global uncertainty and trade turbulence

OUR BUREAU
Mumbai / New Delhi
ven as the world economy grapples with geo-
political instability, slowing trade, and per-
Esistent inflationary pressures, India’s growth
trajectory continues to stand out. In its latest State
of the Economy article published in the October
2025 Bulletin, the Reserve Bank of India (RBI)
underscored that the country’s macroeconomic
fundamentals remain solid, enabling it to navigate
global headwinds with confidence. The central
bank’s assessment was echoed by Deloitte India,
which has raised its GDP forecast for FY2025-26
by 30 basis points to 6.8 percent, reflecting opti-
mism that India’s recovery momentum will sustain
through the year.
The RBI report highlighted that India’s resil-
ience stems from the robustness of its underlying
macroeconomic structure—low inflation, healthy
corporate and banking balance sheets, strong for-
eign exchange reserves, and a credible monetary
and fiscal policy framework. “While the Indian Prime Minister Narendra Modi in a conversation with RBI governor Sanjay Malhotra during the Global Fintech Fest
economy is not immune to global headwinds, it has
so far exhibited resilience,” the RBI noted, adding in Mumbai recently (ANI file photo)
that durable fundamentals have anchored growth
even as advanced economies face rising fiscal risks ing reforms such as GST 2.0, which is expected to India has consistently outperformed major global
and protectionist pressures. further streamline the tax regime. A strong rural economies, posting growth rates of 9.2 percent in
Nonetheless, the RBI maintained an opti- confidence index—hovering above 100—suggests 2023-24, 6.5 percent in 2024-25, and an estimated
mistic tone, emphasizing that structural reforms buoyant sentiment in rural areas, bolstered by fa- 7.8 percent in the first quarter of FY2025-26.
and domestic demand have shielded the economy vorable monsoon patterns and improved crop out- According to the Economic Survey 2024-25,
from external shocks. “The need for economic put. the GDP growth projection for 2025-26 was set
resilience has become a key priority,” the bulle- The firm also noted that the upcoming festive between 6.3 and 6.8 percent, and current data sug-
tin said, pointing to India’s foreign exchange re- season could provide a significant boost to con- gests that the economy is tracking the upper end of
serves—adequate to cover more than 11 months of sumption spending, while corporate investment is that range. The RBI’s latest assessment reinforces
imports and nearly 93 percent of external debt as likely to accelerate as businesses gear up to meet this view, projecting FY2025-26 GDP growth at
of June 2025—as a vital cushion against volatility. growing demand. 6.8 percent while maintaining inflation at a com-
Deloitte India’s latest outlook aligns closely Despite the upbeat projections, both the RBI fortable 2.6 percent—well within its target band.
with the RBI’s cautious optimism. The consultan- and Deloitte caution that India’s growth remains For policymakers, the challenge will be to sus-
cy raised its GDP growth projection for FY2025- vulnerable to global shocks. Escalating trade ten- tain this momentum while navigating an increas-
26 to 6.8 percent, up 0.3 percentage points from sions, supply chain disruptions, and geopolitical ingly uncertain global landscape. Strengthening
its earlier estimate, citing strong domestic demand, frictions could undermine export performance. supply chains, diversifying export markets, and
improving rural sentiment, and low inflation as pri- Deloitte warned that India’s inability to finalize accelerating infrastructure investments will be key
mary drivers. India’s GDP had already grown by key trade agreements with the United States and to maintaining growth above 6.5 percent in the
an impressive 7.8 percent in the April-June quar- the European Union could dampen investor senti- medium term.
ter—well above market expectations—providing a ment and slow capital inflows. At the same time, continued fiscal discipline
strong base for the remainder of the fiscal year. “India is no island,” Majumdar observed. and monetary prudence will be essential to pre-
“India’s performance signals not just resilience “Global risks will inevitably weigh on its econom- serve investor confidence and macroeconomic
but a renewed sense of strength,” said Rumki ic outlook.” While headline inflation has eased stability.
Majumdar, economist at Deloitte India. “Similar due to lower food and fuel prices, core inflation The twin assessments from the RBI and De-
growth rates are expected in the subsequent year, remains stubbornly above 4 percent—posing chal- loitte present a cautiously optimistic picture of In-
although uncertainties around trade and invest- lenges for the RBI’s monetary policy stance. dia’s economy—one that is grounded in reality yet
ment could widen the range of variation.” India’s economic resilience is not accidental— confident in its trajectory. With steady domestic de-
Deloitte attributes the optimistic forecast to a it is the outcome of a sustained focus on macro- mand, robust policy support, and a resilient finan-
combination of factors: robust consumer spending, economic stability, prudent policy management, cial system, India remains poised to retain its posi-
accommodative monetary conditions, and ongo- and structural reform. Over the past four years, tion as the world’s fastest-growing major economy.

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