GDP Expected To Grow 6.5% In FY25, India To Remain Fastest-Growing Major Economy: World Bank

India is projected to maintain the fastest growth rate among the world's largest economies, according to the Global Economic Prospects for January 2025 report by the World Bank.

India's economy expected to grow by 6.5% in the current financial year, 0.1 percentage points lower than the previous estimate. The gross domestic product is projected to grow 6.7% each in FY26 and FY27, making India the fastest growing major economy globally, according to World Bank.

The services sector is expected to enjoy sustained expansion, and manufacturing activity is anticipated to strengthen, supported by government initiatives to enhance logistics infrastructure and improve the business environment through tax reforms, the report stated.

Private-consumption growth is expected to be boosted by a strengthening labour market, expanding credit and declining inflation. However, government consumption growth is likely to remain contained, the report cautioned.

Investment growth overall is expected to be steady, with rising private investment, supported by healthy corporate balance sheets and easing financing conditions, it added.

The GDP growth is expected to decelerate to 6.5% in FY25 from 8.2% in FY24, reflecting a slowdown in investment and weak manufacturing growth, the report noted.