India economy desk

India's Economic Rebalancing: How Does Domestic Resilience Hedge Against the Global Trade Storm?

Crisil, a subsidiary of S&P Global, forecasts that India will achieve 6.5% GDP growth in fiscal year 2026, maintaining its status as the fastest-growing major global economy. However, India's economic external exposure is no longer what it used to be—exports as a share of GDP have risen from 12.6% in FY2002 to 21.2%, and financial flows have jumped from 8.9% to 28.5%. Global tariff shocks, slowdowns in major trading partners, and spillover from cheap Chinese imports are testing the resilience of India's economy. Domestic buffers such as services exports, ample foreign exchange reserves, and prioritized capital expenditure buy India time to adjust. This article provides an in-depth analysis of the structural changes in India's growth model and the long-term challenges under its vision of becoming a developed nation by 2047.