New Delhi: India’s economy grew at 6.2% in 2025, supported by the pre-Diwali GST 2.0 reforms, high domestic consumption and improved tax compliance, even though the unreasonable Trump tariffs weighed heavily on the market sentiments. According to a report by Rubix Data Sciences, GST 2.0 has played a decisive role in strengthening India’s consumption-led growth.
Despite a challenging global environment, with geopolitical tensions, shipping disruptions and rising import costs due to a depreciating rupee, India witnessed growth on the back of sustained consumption, with inflation moving into negative territory for the first time in a decade.
The GST 2.0 reforms helped the automotive industry in particular, with sales rising 41.3% year on year in October, driven by pent-up demand. A stronger agruicultural market helped the rural economy, where credit disbursement grew at an average rate of over 13% from FY2015 to FY2025. Overall, the GST reforms led to a GDP growth of 8.2%, the highest in 2025.
India’s exports with leading destinations also witnessed a rise, with the trade surplus sustained despite the 50% tariffs on most products. In fact, total trade with the US increased at a 3.8% CAGR over the past five years, largely driven by higher electronics exports. However, India’s merchandise exports were largely flat, mostly due to the slowdown in demand globally and trade disruptions.
“At a time when many advanced economies are facing economic headwinds and a deteriorating economic outlook, India continues to offer strong growth and stability making it a natural choice for investors seeking long term value and opportunity.” Sanjay Malhotra, the Governor, The Reserve Bank of India (RBI) had said recently.
