IMF reduced India's economic growth forecast, the effect of tariff war will be seen

The International Monetary Fund (IMF) has estimated India's economic growth rate at 6.2 percent in the financial year 2025-26. This is less than the previous forecast of 6.5 percent. The forecast of the growth rate has been lowered primarily because of trade tensions and worldwide uncertainty.

The International Monetary Organization stated in its World Economic Outlook that, 'For India, the 2025 growth situation is comparatively more stable and the rate of growth will be 6.2 percent. Private consumption, primarily rural, will provide the impetus to growth.'

According to the report, India's economic growth rate is estimated to be 6.2 percent in 2026-27, while it was 6.5 percent in 2024-25. This growth rate estimate is 0.3 percent less than the estimate of January 2025 and the reason for this is trade tension and global uncertainty.

The IMF said, global growth is estimated to be 2.8 percent in 2025, which is 0.5 percent less than the earlier estimate. The growth rate of the global economy is estimated to be three percent in 2026.

The report says about developed economies that the growth rate is estimated to decline to 1.4 percent in 2025 and 1.5 percent in 2026. This growth estimate is 0.5 percent less than the estimate made in January for 2025. It was 1.8 percent in 2024.

For China, GDP growth for 2025 has been cut to 4 per cent from 4.6 per cent in the January report, reflecting the impact of recently implemented tariffs.

The growth forecast for 2026 has also been lowered to 4.0 per cent from 4.5 per cent. For the US, growth is projected to fall to 1.8 per cent in 2025, down 1 percentage point from 2024 and 0.9 per cent from the January 2025 forecast.