India's Gross Domestic Product (GDP) is pegged to grow at 7% in 2025, as the country's economic performance is said to lead growth among emerging and advanced markets, including Australia, Malaysia, Vietnam and Indonesia, credit ratings agency Moody's said in a report.
Moody’s Ratings’ 2026 outlook for companies in Asia-Pacific excluding Greater China (APAC) states that India will lead growth among emerging markets and across the region, with GDP growing 7.0% in 2025 and 6.4% in 2026. The country's domestic growth drivers underpin its economic resilience amid global uncertainty.
GDP growth in APAC will remain steady at 3.4% in 2026 compared with 3.3% in 2024, said Moody's. It pegs a 3.6% growth in 2025. On a weighted average basis, emerging markets will drive GDP growth in the region, with average growth of 5.6% compared to average growth of 1.3% in advanced markets.
As the Indian Rupee has weakened against the dollar in the past few months, most rated companies of the country have active currency risk management or strong financial buffers, while investment-grade entities have demonstrated access to international capital markets. Meanwhile, a few rated companies in the oil and gas, airline, telecom and ride-hailing sectors face dollar exposure because of currency mismatches between rupee-based revenues and dollar-denominated input costs or borrowings.
On 50% tariff levied by the US, Moody's said that the impact of tariffs will be transmitted to companies mainly through three risk transmission channels: trade, weakening macroeconomic conditions and financial markets.
The geopolitical landscape has become more dynamic than ever since US-China tensions continue to inform geopolitical risk in the APAC region. Polarization threatens to disrupt semiconductor supply chains and deepen regional divisions, Moody's said with a 'stable' outlook for the region. However, an escalation in geopolitical tensions or a sharper slowdown in China that weakens regional growth and credit conditions would turn the outlook negative. Conversely, a broad-based decline in interest rates and stronger earnings growth could turn the outlook positive.
Source Name : Economic Times