New Delhi: Even amid fragile global conditions, India is poised to remain the fastest-growing large economy in the world, according to a new report by the United Nations. The UN’s mid-year update of the World Economic Situation and Prospects (WESP) forecasts India’s GDP to grow by 6.3% in 2025. However, it is down from its earlier estimate of 6.6% made in January. However, India continues to outpace its global counterparts, driven by robust private consumption and public investment.
“India remains one of the fastest-growing large economies,” said Ingo Pitterle, Senior Economic Affairs Officer at the UN. The report predicts a slightly stronger growth of 6.4% in 2026.
“The world economy is at a precarious moment,” the UN report warned, highlighting rising trade tensions and policy uncertainty.
India’s projected growth stands in stark contrast to the global average of 2.4% for 2025. China is expected to grow at 4.6%, the US at 1.6%, Japan at 0.7%, the EU at 1.0%, and Germany is forecast to contract by 0.1%. According to the report, India’s resilience to strong domestic demand, public infrastructure spending, and buoyant services exports have worked to its advantage.
It forecast that inflation in India would ease from 4.9% in 2024 to 4.3% in 2025. This forecast stays within the Reserve Bank of India’s target range. The report also flagged external risks, particularly those arising from trade tensions with the United States.
While some Indian export sectors—such as pharmaceuticals, electronics, semiconductors, energy, and copper—are currently exempt from potential US tariffs, the UN cautioned that these exemptions may not be permanent.
Last month, the International Monetary Fund (IMF) projected India’s GDP to grow by 6.2% in 2025 and 6.3% in 2026.
