The US-China trade war may deepen after Donald Trump becomes the next President of America. Its advantages and disadvantages will be seen all over the world, including India. But while this will create turmoil in the world, this tension can prove to be good news for India. A recent report by Goldman Sachs has claimed that India’s economic condition may remain stable amid this global crisis.
This report by Goldman Sachs says that the world’s leading economies will be directly affected by the trade war between America and China. This will break the global supply chain and may lead to a decline in the growth of many countries. But this is going to create a different situation for India. In the last few years, India has promoted the Self-reliant India campaign which
Major steps have been taken towards becoming self-reliant by reducing dependence on imports. India’s GDP growth, despite slowing down to 6.3 percent in 2025, is the best among the world’s major economies. At the same time, India’s economy based on the domestic market also protects it from external shocks.
The role of RBI has been described as important in the Goldman Sachs report. In this, RBI has taken strict steps to reduce inflation due to which loans have become expensive but the economy remains stable. Now in 2025, there is a possibility of gradual reduction in interest rates by RBI due to which the repo rate may be reduced by half percent in February-April. Due to which the lending rates of banks can also be reduced by one and a quarter percent.
Anyway, considering the strength of the dollar and global uncertainties, RBI will not take any hasty steps. The report says that despite global turmoil, India’s economy will remain stable. However, retail loan growth may remain low due to interest rate cuts. But the good news is that the inflation rate in 2025 is expected to be around the RBI target.
India has strengthened its economic policies in the last few years. Schemes like Make in India and Production Linked Incentive have helped in making India a manufacturing hub. The continuous development of IT and service sector is a major reason for India’s economic stability. In this report, Goldman Sachs has said that India’s growth rate may be 7 percent in 2024 and 6.3 percent in 2025. Whereas the inflation rate may be 5.5 percent this year and 4.8 percent next year. Repo rate may also reduce to 6.5 percent in 2025
India can handle its economy strongly amid the US-China trade war. RBI’s policies and Self-reliant India campaign will help India deal with the global crisis. However, the government will have to focus on increasing investment and simplifying stringent regulations.