Key Takeaways
- India’s economy projected to grow at 6.5% through 2027
- Remains fastest-growing G-20 economy despite US tariff challenges
- Diversified exports and stable monetary policy support growth
India’s economy is positioned for strong 6.5% growth through 2027, according to Moody’s Ratings. The country will maintain its status as the fastest-growing G-20 economy, successfully navigating US tariff pressures through export diversification.
In its latest Global Macro Outlook report, Moody’s highlighted that Indian exporters have effectively redirected shipments despite facing 50% US tariffs on certain products. Overall exports climbed 6.75% in September, even as shipments to the US dropped by 11.9%.
Domestic Stability Supports Growth
The rating agency attributed India’s economic resilience to a neutral-to-easy monetary policy stance and controlled inflation. “In India, the RBI held its repo rate steady in October, showing that it is cautious on policy with inflation subdued and growth strong,” the report stated.
Global Growth Context
Moody’s projects global GDP growth at 2.5-2.6% for 2026-2027, reflecting steady but uneven expansion. Advanced economies are expected to grow about 1.5%, while emerging markets, led by India, will expand close to 4%.
“Policy divergence and trade shifts will shape a stable but mixed global growth outlook as economies adjust to post-pandemic and geopolitical realignments,” the report noted.
Regional Economic Outlook
United States: Shows slower but stable momentum, supported by consumer spending and AI investment. Moody’s observed “narrow credit spreads, robust equity markets, and ample funding liquidity have created benign financial conditions.”
Europe: Modest improvement driven by employment gains and monetary policy easing. Germany’s fiscal push in defense and public projects is expected to support regional growth.
China: On track for 5% growth in 2025, supported by government stimulus and exports, though domestic fundamentals remain soft with uneven consumption and weak corporate lending. Growth is expected to slow to 4.2% by 2027.
