IMF Trims India's Growth Forecast Amid Global Trade Tensions

The IMF has revised its growth forecast for India's economy to 6.2% in 2025-26 due to escalating trade tensions and global uncertainty, down from 6.5%. Global growth estimates have also been lowered, with advanced economies facing significant downward revisions, highlighting the impact of increased trade and policy uncertainty.

The International Monetary Fund (IMF) has adjusted its growth forecast for India, projecting a 6.2% increase in 2025-2026, downgraded from a previous estimate of 6.5%. This revision is attributed to mounting trade tensions and global uncertainties impacting the economic outlook. Private consumption, particularly in rural areas, is expected to underpin this growth.

The report highlights that emerging and developing Asia, including ASEAN countries, has been significantly impacted by trade tariffs, with anticipated growth further slowing in 2026. The IMF emphasizes that global economic dynamics have stabilized post-pandemic, yet continuing uncertainties and policy shifts pose risks to sustained economic progress.

Amid these challenges, the IMF suggests countries cooperate to create a stable trade environment and address domestic policy holes. It underscores the importance of fiscal strategies promoting healthy aging, labor participation, and integration of migrants to foster productivity and stability in the global economy.

(With inputs from agencies.)