India's Economy Defies Global Shocks, Eyes Fastest Growth: Das
Overview
India's economy demonstrates remarkable resilience against global disruptions like the pandemic and geopolitical conflicts, according to Shaktikanta Das, former RBI Governor. The nation is projected to be the fastest-growing major economy, contributing significantly to global GDP growth. Prudent monetary and supply-side measures have controlled inflation, while fiscal consolidation efforts are strengthening the economic outlook.
India's Economic Resilience Amid Global Headwinds
NEW DELHI – India's economy continues to exhibit robust resilience despite facing multiple overlapping global shocks, with the government maintaining a steadfast commitment to macroeconomic and financial stability. This was stated by Shaktikanta Das, former Governor of the Reserve Bank of India, speaking at the Bibek Debroy Memorial Lecture.
Das emphasized that India's growth story is built on a foundation of stability, reforms, and targeted schemes addressing structural economic gaps. This commitment to stability has been a cornerstone for over a decade, providing the bedrock for the nation's expansion.
Fastest Growth Projected
The Indian economy is expected to lead global growth, contributing approximately one-fifth of the world's GDP expansion in the current fiscal year. Projections from the National Statistics Office (NSO) indicate real GDP growth of 7.4% for 2025-26. India is anticipated to account for around 18% of global GDP growth during the same period.
Inflation Under Control
Inflation has been successfully managed, reaching a low of 0.25% in October 2025. Das attributed this achievement to "prudent" monetary and supply-side measures. Resolute monetary tightening and supply-side interventions in response to global commodity price spikes following the Ukraine conflict have led to a sharp decline in inflation, providing significant relief to consumers and supporting economic stability.
Fiscal Consolidation Progresses
Fiscal consolidation efforts are advancing well. The central government's fiscal deficit has been reduced from 9.2% in 2020-21 to a projected 4.8% in 2024-25. Similarly, the general government debt-to-GDP ratio has declined to 81.6% in 2024-25 from a peak of 88.4% in 2020-21.
Das highlighted India's ability to roll back monetary and fiscal expansions implemented during the pandemic in a timely manner, differentiating it from many other nations. This timely action has ensured macroeconomic and financial stability, while restoring headroom for future counter-cyclical policies and maintaining a sustainable public debt level.
