Till a few years ago, China and Japan were the two countries which were considered the superengines of Asia’s growth. Now India and Vietnam have replaced these two countries. These two countries have the best figures in the entire Asia region. No other country has that. It is especially important to mention India here. There is a reason for this also. India’s economic growth figures in the second quarter were more than 8 percent. It is clear that India is making the biggest contribution to the growth of Asia. This is also the reason why the Asian Development Bank has increased the growth estimates of Asia. Let us also tell you what kind of figures the Asian Development Bank has presented regarding Asia and India?
Asia back on track
In an update to its Asian Growth Outlook, ADB said the growth rate in 2025 is now projected at 5.1 percent, up from the 4.8 percent forecast in September, and up from the 4.9 percent forecast when the report was first released in April. Citing reduction in trade uncertainty following several US agreements, the bank has raised its 2026 growth forecast for the sector to 4.6 per cent from 4.5 per cent. The region includes 46 economies ranging from China and India to Georgia and Samoa, but excludes Japan, Australia and New Zealand.
ADB said that although regional growth is expected to moderate next year, strength in exports due to the uptick in AI and electronics cycles will help sustain economic activity, while also reducing trade uncertainty. The report said potential re-increases in tariffs and trade policy uncertainty, and increased financial market volatility, remain significant downside risks to the future.
Increase in growth of South Asia
Subregional prospects have also improved, with South Asia expected to grow 6.5 percent this year, up from the previous estimate of 5.9 percent, and India beating projections for 8.2 percent growth in its second fiscal quarter ending in September. Southeast Asia is expected to grow at 4.5 percent this year, up from 4.3 percent previously, and is expected to reach 4.4 percent in 2026, but ADB said risks remain from global uncertainties, climate-related disruptions and domestic political developments.
Recent events highlight these vulnerabilities, with massive floods in Indonesia, Thailand and Malaysia in late November killing hundreds and displacing millions. Meanwhile, fighting has also flared up between Thailand and Cambodia, with border skirmishes and airstrikes renewed this week, derailing a fragile ceasefire brokered by US President Donald Trump after a five-day war in July.
Crisis continues in China
China’s forecast for 2025 has increased to 4.8 percent from 4.7 percent, still below Beijing’s target of 5.0 percent, while the forecast for 2026 is unchanged at 4.3 percent, reflecting the continued weakness in the country’s property market. ADB said the continued slowdown in the property sector is impacting activity, with a sharp decline in property investment leading to a decline in real estate investment and a slowdown in infrastructure and manufacturing investment. ADB said that inflation is expected to decline from 1.7 percent estimated in September to 1.6 percent in 2025, which will increase to 2.1 percent in 2026.