India to grow 7% in 2025, says Moody’s

• Moody’s projects India’s GDP growth at 7% in 2025 and 6.5% in 2026.
• Growth supported by infrastructure spending, domestic demand, and export diversification.
• Indian exporters show resilience despite 50% US tariffs on select products.
• Moody’s warns of rising global trade restrictions and possible US–China decoupling.

Moody’s Ratings on Thursday projected India’s economy to grow 7 per cent in 2025 and 6.5 per cent in 2026, supported by domestic demand, export diversification and a neutral-to-easy monetary policy stance.

In its Global Macro Outlook, Moody’s said India’s growth remains underpinned by infrastructure spending and steady consumption, though private sector capital expenditure continues to be cautious. The agency said it expects India — the fastest-growing G-20 economy — to maintain 6.5 per cent growth through 2027.

Real GDP growth for the 2025 calendar year is pegged at 7 per cent, compared with 6.7 per cent in 2024.

Moody’s noted that Indian exporters have continued to perform well despite facing 50 per cent US tariffs on certain products. Overall exports rose 6.75 per cent in September even as shipments to the US fell 11.9 per cent.

“We expect its economy to continue to grow around 6.5 per cent in 2026 and 2027, supported by a neutral-to-easy monetary policy stance amid low inflation,” Moody’s said.

The agency added that steady international capital inflows, backed by strong investor sentiment, have helped shield the economy from external shocks.

On the global economy, Moody’s said growth is expected to remain steady but subdued, with advanced economies expanding modestly and emerging markets retaining stronger momentum. It warned that increasing trade restrictions have raised the prospect of US–China decoupling, even as other major economies deepen bilateral links.

For China, Moody’s forecast 5 per cent growth in 2025 driven by government stimulus and strong exports, with expansion slowing to 4.2 per cent by 2027.

Globally, Moody’s expects real GDP growth to remain in the 2.5–2.6 per cent range in 2026 and 2027, after an estimated 2.6 per cent in 2025 and 2.9 per cent in 2024.