India’s development pace maintains
Famous American rating agency Fitch has once again expressed confidence in India’s economic health. Fitch has retained India’s rating on BBB– and has also said that India’s economic condition will remain strong in the coming times. According to Fitch, the speed of India’s GDP i.e. economy is going to be 6.5% in the next year i.e. 2025-26, which is much better than most of the countries of the world. The agency says that the government’s expenses in India and the power of shopping of the people will maintain this growth.
Tariff has no effect on GDP
From August 27, a tariff will be imposed by the US on India’s goods, but Fitch says that its direct effect will be very less on India’s GDP. The reason for this is that India’s export to America is only 2% of our entire economy. Yes, it is a matter of fact that such decisions can affect the business environment and the speed of investment may be slightly slow. But if GST is implemented better in India, then it will increase consumption and the effect will reduce greatly.
RBI can cut interest rate again
Fitch said that inflation in India is quite low at the moment. In July 2025 it fell to just 1.6%, especially due to the cheap food and drink. RBI, the Reserve Bank of India, has also cut interest rates by 1% between February and June this year. This means that the loan has become cheaper. Fitch hopes that there may be another small cut in the coming time. This can provide some more relief to business and common people.
Government spending wisely money
Fitch says that the Government of India is now spending more wise money than before. While more money is being invested on projects like roads, bridges and electricity on one side, unnecessary subsidy is being cut on the other side. The government’s deficit in 2021 was 9.2%, which has now come down to 4.8%. The target is to bring it to 4.4% next year. That is, the government is gradually making balance in its expenses and earnings. However, the total debt of the government is still more than 80% of GDP, which is much higher. Fitch hopes that this debt will gradually decrease, but it will take time. The burden of interest is also heavy on the government, which is about 23% of the total earnings.
Foreign exchange reserves become India’s strength
India currently has a foreign exchange reserves of about $ 695 billion, which can help the country in every situation. India has so much money that it can fulfill all its foreign expenses for eight months. Apart from this, foreign debt on India is also very low, only 3%. With this, our economy is less threatened by the world’s turmoil. The current account deficit (CAD) is also less than 1%, which is a good sign.