Will India Achieve a 7% GDP Growth by 2025?
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Synopsis
Moody's Ratings predicts a bright economic outlook for India, with GDP growth projected at 7% in 2025. This report highlights India's resilience and potential despite global challenges, making it a focal point in the emerging markets landscape.
Key Takeaways
- Projected GDP Growth: 7% in 2025 and 6.4% in 2026.
- Leadership in Emerging Markets: India is set to lead growth in the Asia Pacific region.
- Stable Economic Outlook: Moody's maintains a stable outlook for India's economy.
- Impact of US Tariffs: Limited immediate impact, potential long-term constraints.
- Fiscal Challenges: High debt burden remains a concern despite growth.
New Delhi, Nov 28 (NationPress) As India approaches its Q2 GDP figures due to be released on Friday, Moody's Ratings has forecast that the nation is set to achieve a 7 percent GDP growth in 2025, followed by 6.4 percent in 2026, fueled by robust domestic growth and economic resilience in the face of global challenges.
The country is anticipated to spearhead growth among emerging markets as well as within the Asia Pacific (APAC) region, according to insights from the global rating agency. "India is projected to be at the forefront of growth among emerging markets and throughout the region, with GDP anticipated to grow by 7 percent in 2025 and 6.4 percent in 2026," stated Moody's Ratings in their report.
Average GDP growth for the APAC region is estimated to remain stable at 3.4 percent in 2026, in contrast to an expected growth rate of 3.6 percent in 2025.
Moody's also noted that emerging markets will be the driving force behind GDP growth in the region, with an average growth rate of 5.6 percent.
In September, Moody's reaffirmed India's long-term local and foreign-currency issuer ratings, maintaining the local-currency senior unsecured rating at Baa3. The agency also confirmed its outlook for India as stable.
According to Moody’s, the affirmation of ratings and stable outlook underscores their belief that India's existing credit strengths—such as its large, rapidly growing economy, solid external position, and reliable domestic financing for ongoing fiscal deficits—will be upheld.
While the US has imposed high tariffs on India, Moody's suggested that the immediate adverse impacts on India's economic growth will be limited. However, they cautioned that this could hinder medium to long-term growth by obstructing India’s aspirations to cultivate a higher value-added export manufacturing sector.
India's credit strength is tempered by persistent fiscal weaknesses. Despite strong GDP growth and gradual fiscal consolidation, the government's high debt burden is likely to decline only slowly. Recent fiscal measures aimed at bolstering private consumption could further deplete the government's revenue base, as per the agency's analysis.
Point of View
It's crucial to stay informed about India's evolving economic landscape. These projections from Moody's Ratings offer a glimpse into the country's potential, and understanding them can help us navigate our future in a competitive global economy.
NationPress
28/11/2025
Frequently Asked Questions
What is India's projected GDP growth for 2025?
India's GDP is projected to grow by 7% in 2025 according to Moody's Ratings.
What factors are contributing to this growth?
The growth is attributed to strong domestic conditions and economic resilience despite global disruptions.
How does India's growth compare to the APAC region?
India is expected to lead growth in the APAC region, where average GDP growth is projected at 3.4% in 2026.
What is Moody's outlook on India's economy?
Moody's maintains a stable outlook for India, reflecting its credit strengths and economic stability.
What impact will US tariffs have on India's economy?
Moody's suggests that while high tariffs will have limited immediate effects, they could constrain India's long-term growth potential.
