'Key growth engine': IMF hails India's economy; what's impact of Trump tariffs?

International Monetary Fund (IMF) Managing Director Kristalina Georgieva has hailed India arsenic a “key maturation engine” of the planetary economy. Her remarks travel arsenic the planetary system is battling commercialized tariffs imposed by US President Donald Trump connected April 2.

“Global maturation patterns person been changing implicit the years, notably with China decelerating steadily portion India develops into a cardinal maturation engine,” Georgieva said up of adjacent week’s IMF and World Bank yearly meetings successful Washington.Speaking astatine the Milken Institute, Georgieva said the planetary system is “doing amended than feared, but worse than we need.” She noted that maturation is expected to dilatory “only somewhat this twelvemonth and next,” supported by stronger-than-expected show successful the United States and cardinal emerging economies, including India. “All signs constituent to a satellite system that has mostly withstood acute strains from aggregate shocks,” she said, citing “improved argumentation fundamentals,” the adaptability of the backstage sector, and “lower-than-expected tariffs.”The IMF chief’s comments travel amid heightened planetary uncertainty aft US President Donald Trump imposed sweeping tariffs, including a 50 per cent levy connected Indian imports, fractional of which targets India’s discounted purchases of Russian oil.

Washington has accused India and China of “funding” Moscow’s warfare effort, but New Delhi has maintained that its vigor procurement is guided by nationalist involvement and marketplace dynamics.Georgieva, besides appeared to downplay the contiguous planetary fallout of Trump’s commercialized policies, saying the satellite has “avoided a tit-for-tat descent into commercialized warfare — truthful far.” She noted that the US tariff complaint has fallen from 23 per cent successful April to 17.5 per cent today, though the effectual complaint remains “far supra the remainder of the world.”

Still, she warned, “The afloat effect of those tariffs is inactive to unfold. Global resilience has not yet been afloat tested.

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Indian system surges ahead

India has besides downplayed the interaction of 50% tariffs imposed by the United States. Last week, Union concern curate Nirmala Sitharaman said that the Indian system continues to show resilience and sustainable growth, driven by beardown home depletion and investment“The Indian system is resilient and continues to turn sustainably,” she stated, adding that outer shocks would person constricted interaction connected the country's maturation trajectory.Meanwhile, India recorded a robust 7.8% existent GDP maturation successful Q1 of FY 2025–26, outperforming the RBI’s earlier estimation of 6.5%. The maturation was supported by a revival successful depletion and a caller simplification successful GST rates.