Moody’s slashed India’s 2025 growth forecast to 6.3%

Current Context: On 6th May 2025 Moody's revised India’s GDP growth forecast for 2025 to 6.3%, down from its earlier estimate of 6.6%.

• The downgrade is attributed to policy shifts, trade uncertainties, and geopolitical risks, including tensions between India and Pakistan.

Key Factors Behind the Revision

• Global Trade Uncertainty: US-China trade tensions and evolving tariff policies are expected to impact global trade.
• Geopolitical Risks: Rising tensions in South Asia, particularly between India and Pakistan, pose economic challenges.
• Policy Adjustments: The Reserve Bank of India (RBI) is expected to lower benchmark policy rates to support domestic growth.
• Global Economic Slowdown: Moody’s also revised China’s GDP growth to 3.8% and US growth to 1%, reflecting broader economic concerns.

Question:

Q.1 What is the revised GDP growth forecast for India in 2025 according to Moody’s, as of 6th May 2025?
a) 6.6%
b) 6.1%
c) 6.3%
d) 6.0%

Answer: c) Moody’s revised India’s GDP growth forecast for 2025 down to 6.3% from its earlier estimate of 6.6%, citing multiple global and domestic factors.