India’s economy will continue to grow at the quickest rate among the mature and emerging G-20 countries, and the size of its domestic market makes it less exposed to possible shocks from US trade policies. Based to the research, India has a low external vulnerability indicator because of its comparatively moderate external debt-to-GDP ratio of 19% and low exporting dependency on the US market at 2%.
Moody’s claimed in its report on emerging markets that India’s GDP growth, predicted at 6.5% for 2025-26, will remain the strongest among advanced and emerging G-20 countries as a result of tax cuts and continuing monetary policy easing by the Reserve Bank as inflation has decreased.
According to the research, inflation in India is expected to average 4.5 percent in the current fiscal year, down from 4.9 percent in the previous year. This is likely to pave the way for a soft money policy, which would involve lower interest rates and increased economic liquidity to stimulate economic growth.
Large, broad, and locally driven economies of emerging markets, such as India and Brazil, are better positioned than lesser peers to keep attracting capital and endure cross-border outflows. These two economies also have deep domestic capital markets and low external vulnerability indicators,” Moody’s stated.
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