Archive · 23 Jul 2025
India's Economic Outlook: Growth Projections and Key Factors
India's economy is expected to grow, but a bit slower than earlier predicted, due to worries about trade and tariffs.
However, the economy is still growing fast.
Experts believe India will become one of the world's biggest economies in the next few years.
States play a big role in this, with some likely to be as big as major countries.
India is also building a lot of new roads, airports, and other infrastructure.
To help the economy, the central bank has cut interest rates and reduced the amount of money banks must keep on hand.
ADB lowered India's FY26 growth forecast to 6.5% due to trade uncertainty and higher US tariffs.
Morgan Stanley projects India to be the 3rd-largest economy by 2028, reaching $10.6 trillion by 2035.
Several Indian states are projected to have economies nearly $1 trillion each by 2035.
Infrastructure development, led by central and state initiatives, has significantly grown in the last decade.
The RBI has reduced the repo rate and cash reserve ratio to support economic activity.
- Who
- Asian Development Bank, Morgan Stanley, and the Reserve Bank of India.
- What
- Forecasts and projections for India's economic growth and development.
- When
- FY26 and beyond; projections up to 2035.
- Where
- India.
- Why
- Due to trade uncertainty, tariff impacts, and overall economic strategies.
Economic Slowdown Concerns
Positive Economic Indicators
Factors Influencing Growth
Economic Slowdown Concerns
Concerns regarding trade uncertainty and rising US tariffs.
Positive Economic Indicators
Focus on domestic consumption and the growth of the services and agriculture sectors.
- ADB FY26 Growth Forecast
- 6.5%
- Morgan Stanley Projection - Economy Rank
- 3rd Largest by 2028
- Morgan Stanley Projection - Economy Size by 2035
- $10.6 trillion
- States with $1 Trillion Economies (projected)
- Maharashtra, Tamil Nadu, Gujarat, Uttar Pradesh, Karnataka
- RBI Repo Rate Reductions
- 100 basis points since February