India to remain fastest-growing major economy with 6.5% growth in FY26: International Monetary Fund (IMF)
- IBEF
- March 4, 2025
India is set to retain its position as the fastest-growing major economy, with the International Monetary Fund (IMF) projecting a Gross Domestic Product (GDP) growth rate of 6.5% in 2025-26, driven by robust private investment and macroeconomic stability. The second advance estimate released by the Indian government also predicts 6.5% growth for 2024-25, with headline inflation expected to stabilize as food price shocks ease. The IMF’s Article IV consultation highlighted that India’s strong economic performance presents a key opportunity to implement structural reforms necessary to achieve its goal of becoming an advanced economy by 2047.
The IMF emphasized the need for deeper structural reforms to boost private investment, job creation, and economic growth. Priorities include labour market reforms, strengthening human capital, and increasing women’s workforce participation. Boosting Foreign Direct Investment (FDI) and private sector investments will require stable policy frameworks, governance reforms, trade integration, and improved ease of doing business. Despite recent moderation, India’s financial sector remains strong, with non-performing loans at record lows, fiscal consolidation ongoing, and the current account deficit under control, supported by strong service export growth.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.
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