India's economy is showcasing robust performance, with Prime Minister Narendra Modi highlighting the nation's trajectory to become the world's third-largest economy in the near future. Speaking at the Economic Times World Leaders Forum 2025 on August 23, 2025, PM Modi stated that India is currently the fastest-growing major economy globally and is projected to contribute around 20% to the world's growth soon.
The Prime Minister attributed this growth and resilience to the macroeconomic stability achieved over the last decade. Key economic indicators cited include a projected fiscal deficit reduction to 4.4% despite the COVID-19 pandemic, stronger banks, low inflation, controlled current account deficit, and robust forex reserves. Indian companies are also raising record funds from capital markets, and domestic investors are consistently investing through Systematic Investment Plans (SIPs).
Significant policy reforms are underway, with the next-generation Goods and Services Tax (GST) reform process expected to be completed before Diwali. This reform aims to simplify the GST law and reduce prices. The GST Council is also scheduled to meet on September 3-4 to discuss key reforms in the tax system.
In a push towards self-reliance and technological advancement, PM Modi announced that India would see its first domestically made semiconductor chip in the market by the end of 2025. He urged the private sector to increase investment in research and development across various sectors, including clean energy, quantum technology, battery storage, advanced materials, and biotechnology. India has also made significant strides in the energy sector, achieving its target of generating 50% of its total power capacity from non-fossil fuels in 2025, five years ahead of the 2030 schedule.
In other business news, the Reserve Bank of India (RBI) has approved SMBC's acquisition of a 24.99% stake in Yes Bank. India has demonstrated strong performance in real estate and exports, leading Asia Pacific (APAC) office demand with a 70% share in H1 2025 leasing and surpassing China in smartphone exports to the United States. The India flash Purchasing Managers Index (PMI) surged to 65.2 in August, indicating record services and manufacturing growth.
Trade relations remain a key focus. India and Australia concluded the 11th round of negotiations for a Comprehensive Economic Cooperation Agreement (CECA) on August 23, 2025, discussing goods, services, and digital trade. Amidst discussions around US tariffs and India's purchase of Russian crude oil, Indian ministers have reiterated that trade decisions are guided by national interest. However, India Post will temporarily suspend parcel services to the US from August 25. Additionally, Nayara Energy, a Russia-backed refinery in India, is reportedly facing fresh US and EU sanctions trouble, impacting its EPC (Engineering, Procurement, and Construction) work.