Global economic conditions to weaken in 2025 but India's strong growth continues: World Economic Forum

On trade outlook, 48 percent of chief economists predicted an increase in global trade volumes in 2025, underscoring the resilience of global commerce.

A majority of economists around the world expect weaker global economic conditions in 2025 but India is likely to maintain a strong growth despite signs of some momentum being lost, as per a report.

In its latest Chief Economists Outlook released on January 16, the World Economic Forum said the global economy is set to face significant challenges in 2025, with 56 percent of chief economists surveyed expecting conditions to weaken.

The US economy is expected to deliver robust growth in 2025, and South Asia, particularly India, is also expected to maintain strong growth, the report added.

Only 17 percent foresee an improvement, pointing to heightened uncertainty in key regions and the need for measured policy responses worldwide, it found.

The report is based on consultations and surveys with leading chief economists from across the globe.

The outlook for Europe remains gloomy, with 74 percent respondents predicting weak or very weak growth this year.

The outlook for China also remains weak, and growth is projected to slow gradually in the years ahead, the WEF said in the report.

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The report further stated that South Asia continues to stand out, with 61 percent of chief economists expecting strong or very strong growth in 2025.

"This regional performance has been driven largely by robust growth in India, which remains the world's fastest-growing major economy. However, there are now signs of some momentum being lost," the report said.

The latest national accounts data for India point to year-on-year GDP (gross domestic product) growth of 5.4 per cent in the third quarter of 2024, the slowest rate in nearly two years, prompting a downward revision to the central bank's annual growth forecast in December.

China's economic momentum is projected to slow amid subdued consumer demand and weaker productivity, further illustrating the uneven and uncertain nature of any global recovery.

On trade outlook, 48 percent of chief economists predicted an increase in global trade volumes in 2025, underscoring the resilience of global commerce.

Having said that, a large majority expected intensifying trade tensions, both between major powers and more widely.

Protectionism was identified as the primary factor that will drive lasting changes to global trade patterns, with other prominent contributors including conflict, sanctions and national security concerns.

82 percent of respondents predicted greater regionalisation of trade over the next three years, alongside a continuing gradual shift from goods to services.

With inputs from PTI.