India
Year: 2025
Type: article
Abstract: The 2025 Article IV Consultation highlights that India’s strong economic performance has benefitted from sound macroeconomic policies and earlier structural reforms. Despite external headwinds, growth is expected to remain resilient, with inflation remaining subdued. Amid high uncertainty, potential upside risks stem from swift conclusions of trade agreements and accelerated implementation of domestic structural reforms, while possible downside risks from deepening geo-economic fragmentation persist. Reinforcing macroeconomic and financial stability will help support conditions conducive for sustained growth. Steadfast implementation of structural reforms is essential to raise potential growth. The planned moderate pace of fiscal consolidation this year is appropriate, and fiscal support to mitigate the adverse impacts of tariffs should be targeted, transparent and timebound. Systemic financial risks are broadly contained. Pockets of vulnerability resulting from concentration risks and rising interconnectedness should be mitigated. Sustaining high potential growth and sufficient job creation requires strong structural reforms. Priorities include high and efficient public investment, labor market flexibility, streamlined regulations, and trade and investment liberalization to boost competitiveness and attract foreign direct investment.
Source: IMF Staff Country Reports
Author: International Monetary Fund. Asia and Pacific Dept
Language: English
Subfield: Economics and Econometrics
Domain: Social Sciences
Open Access status: diamond
OpenAlex ID: W7108069384