India to Remain Fastest-Growing Major Economy: UN

India to Remain Fastest-Growing Major Economy: UN

Why in the News ?

The UN’s World Economic Situation and Prospects (WESP) mid-year update projects India’s GDP growth at 6.3% in FY 2025, outpacing China, the US, and the EU, driven by household spending, public investments, and services exports.

India to Remain Fastest-Growing Major Economy: UN

About India’s Growth Outlook and Key Drivers:

  • India’s economy is projected to grow at 3% in FY 2025, maintaining its position as the world’s fastest-growing major economy.
  • Growth is being powered by robust household consumption, government capital expenditure, and rising services exports.

  • Although revised slightly from 6% forecast in January, India’s growth remains well ahead of other major economies.

Comparative Global Economic Performance

  • China: Projected GDP growth of 6%.
  • United States: Growth forecast at 6%.
  • European Union: Only 1% growth expected, with Germany facing -0.1% contraction.
  • Japan: Estimated to grow by just 7%.

  • The global economy is under pressure due to trade tensions, policy uncertainties, and sluggish investment.

Positive Indicators for Indian Economy

  • Inflation in India is forecasted to decline from 9% in 2024 to 4.3% in 2025, staying within the RBI’s comfort zone.
  • Employment prospects show improvement, reinforcing macroeconomic stability.
  • India stands out as a bright spot in a fragile global economy.