India's economic growth is expected to slow down amid the uncertainty created by US tariffs and world trade tensions around the world. After US agency Moody's, now rating agency Fitch has also made a similar estimate about India's GDP. On Thursday, Fitch Ratings has reduced the estimate of India's gross domestic product (GDP) growth rate for the current financial year 2025-26 to 6.4 percent.
In the Global Economic Outlook april 2025, Fitch Ratings said that world growth could fall below two percent this year. Whereas, barring the pandemic period, this will be the slowest pace since 2009. In the march update, rating agency Fitch said that due to the US trade policy being more aggressive than expected, this is a significant risk in its estimate. However, india is somewhat saved from this due to less dependence on external demand.
In its special quarterly 'update' of the Global Economic Outlook (GEO), rating agency Fitch further said, "It is difficult to say anything with full confidence about US trade policy. Policy uncertainty at a broad level is harming the prospects of trade investment. The fall in stock prices is reducing domestic wealth and US exporters will face retaliatory action. "
Fitch cut its GEO 2025 world growth estimates by 0.4 percent in the month of March. Growth estimates for china and the US were reduced by 0.5 percent. In the context of india, the rating agency has reduced the GDP growth forecast for the financial year 2024-25 to 6.2 percent and the GDP growth forecast for the current financial year 2025-26 to 6.4 percent. The growth rate for the financial year 2026-27 has been maintained at 6.3 percent. According to Fitch's estimates, US GDP growth is expected to remain positive at 1.2 percent until 2025. China's growth rate is expected to remain below 4 percent this year and next year, while economic growth in the Eurozone will remain well below one percent.
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