New Delhi–Despite an increasingly uncertain global environment, the Indian economy continues to demonstrate strong resilience and is well-positioned for sustained high growth, according to the Reserve Bank of India’s (RBI) October Bulletin released on Monday.
The central bank highlighted improvements in capacity utilisation and domestic demand, along with robust expansion in the manufacturing and services sectors. Meanwhile, inflation remains subdued and well below the RBI’s target — providing much-needed flexibility for monetary policy to support economic growth.
“High-frequency indicators point to a revival in urban demand and robust rural demand,” the bulletin noted. “Headline consumer price index (CPI) inflation moderated sharply in September, marking its lowest reading since June 2017.”
Amid growing global headwinds — including renewed US-China trade tensions and a prolonged US government shutdown — investor sentiment has cooled. Yet global growth has largely held firm, with India emerging as a relative bright spot.
In a boost to India’s economic outlook, both the International Monetary Fund (IMF) and the Organisation for Economic Co-operation and Development (OECD) have revised India’s GDP growth projections for 2025 upward. The IMF now expects 6.6% growth (up 20 basis points), while the OECD raised its forecast by 40 basis points to 6.7%, citing sustained domestic demand.
However, the IMF slightly revised India’s 2026 growth projection downward, citing concerns over the medium-term impact of elevated US import tariffs.
RBI Governor Sanjay Malhotra underscored the resilience of the Indian economy and reaffirmed the central bank’s commitment to balancing growth with price stability.
“Despite an external environment that has deteriorated since the August policy, the Indian economy remains poised to register high growth,” Malhotra said. “The sobering of inflation has given greater leeway for monetary policy to support growth without compromising on the primary mandate of price stability.”
Looking ahead, Malhotra emphasized the importance of policy coordination to achieve India’s long-term developmental goals.
“As India strives towards achieving Viksit Bharat by the centenary year of its independence, it would need the coordinated support of fiscal, monetary, regulatory, and other public policies,” he stated.
He also welcomed the recent rationalisation of GST rates as a significant step toward improving economic efficiency and boosting growth.
“In terms of monetary policy actions, we will remain vigilant of the incoming data and stay focused on our objective of maintaining price stability while supporting growth,” the RBI Governor added. “In pursuit of this objective, we will be proactive, objective, and consistent in our communication while backing it up with credible actions.”
As global uncertainty continues to loom, the RBI’s message is clear: India’s fundamentals remain strong, and with prudent policy action, the country is well-equipped to navigate external challenges and stay on a high-growth path. (Source: IANS)
