Global Economy Set to Slow Down
The latest IMF estimates for global real GDP growth in 2025 and 2026 show a slowdown across the world. The world economy is expected to grow at 2.8% in 2025 but could see a slight pickup to 3% in 2026. While the overall picture looks a little better in the second year, advanced economies are facing bigger challenges. These numbers are based on calendar years, not financial years, which is important to keep in mind while comparing.
Advanced Economies Face a Bigger Slowdown
In advanced economies, real GDP growth is dropping quite a bit. It is expected to fall from 1.8% to just 1.4% in 2025, before slightly improving to 1.5% in 2026. The United States is slowing sharply, from 2.8% to 1.8% this year and 1.7% next year. In the Euro area, growth is weak too, but there is hope of a small rise from 0.8% to 1.2%. Japan’s growth is mostly flat, while the UK and Canada are expected to pick up slightly.
Emerging Markets Also Cooling Off
Emerging markets and developing countries are also slowing, but not as sharply. Their growth is expected to fall from 4.3% to 3.7% this year, and recover slightly to 3.9% next year. China is seeing a significant slowdown, from 5% down to 4%, which is a 20% drop in growth. Russia’s growth will also fall sharply, from 4% to less than 1%. Other countries like Brazil and Mexico are slowing or remaining flat, with Saudi Arabia showing a strong recovery.
India Stays Strong and Stable
Among all these shifts, India stands out. India’s growth will dip slightly from 6.5% to 6.2% this year, and rise again to 6.3% next year. Compared to China’s 20% drop, India’s growth decline is very small, only around 5%. India continues to show stability and remains a strong growth story. Even when the global economy slows, India’s economy looks resilient and consistent.
Global Capital Will Keep Looking at India
Looking at this global picture, it is clear that India will continue to attract a lot of global money. Investors looking for growth will naturally turn to India. There might be small challenges and market corrections along the way, like those seen in recent months, but the long-term trend is clear. India remains one of the top growing economies in the world, and international capital will keep chasing its growth story.
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