The Indian economy continues to demonstrate strength amidst the geopolitical challenges, supported by robust domestic demand, sustained industrial and services sector activity, and improving labour market conditions, Shaktikanta Das, principal secretary-2 to the prime minister and former Reserve Bank of India (RBI) governor, said on Tuesday.
The 7.8% GDP growth in the April-June quarter reflects this strength of the Indian economy, Das said. The country has also undertaken several reforms over the last few years, which has supported growth, but more needs to be done in areas of space technology and nuclear energy, Das said at the launch of the India Emerging Economic Order Forum by the Delhi School of Economics and Research and Information System for Developing Countries.
Importantly, India needs to reduce import dependence on oil and gas, Das said. To cut dependence on energy imports, the government has already launched Samudra Mantan, a national offshore exploration of deep waters, Das said.
“High frequency indicators, such as GST collections, electricity generation, rail freight movement, wholesale and retail vehicle sales, and similar other trends point to broad-based economic momentum,” Das said.
“On the external front, India’s economy remains stable despite global uncertainties and geopolitical tensions,” the former RBI governor said. The implementation of the recent trade agreements is expected to enhance India’s export opportunities through greater market access, Das added.
In the five-year period ended 2025-26, India recorded an average annual real GDP growth of 7.9%, reflecting economic resilience and resurgence, Das said.
India’s recent reforms can also serve as important lessons for the global south, Das said.
“India has emerged as a trusted partner for the countries of the global south, drawing legitimacy from its long-standing respect for sovereignty, strategic autonomy and peaceful coexistence,” Das said.
“Though through partnerships, capacity building, initiatives, concessional financing, and outward foreign direct investment, India has sought to promote mutually beneficial growth rather than extractive engagement,” he said.
The former RBI governor said that there are five key areas where economies in the global south need to pay attention: food security, trade diversification and deepening participation in global supply chains, energy transition, maintaining macroeconomic stability, and creating jobs and economic opportunities.
“The recent conflict in the Middle East has underscored the vulnerability of the global south economies to energy shocks, with energy importing countries bearing the brunt of higher fiscal pressures and strained foreign exchange reserves. The lesson is clear: diversification of the energy mix can reduce vulnerability and strengthen domestic resilience,” Das said.
These challenges can be addressed only through collective action, Das said. “While individual countries often have limited influence in international economic negotiations, their collective voice can constitute a powerful force in shaping global economic outcomes,” he added.
Source: The Financial Express
