May 18 – India will remain the fastest-growing major economy in the world, according to a new mid-year report by the United Nations (UN). The World Economic Situation and Prospects (WESP) update projects India’s economy to grow by 6.3% in the current fiscal year, despite global economic headwinds.
The report notes that India’s economic performance stands out among major global economies. In comparison, China is expected to grow at 4.6%, the United States at 1.6%, Japan at 0.7%, and the European Union at just 1%. Germany, Europe’s largest economy, is forecast to contract by 0.1%.
However, the Indian growth estimate has been revised downward by 30 basis points from earlier projections, reflecting weaker global prospects amid rising trade tensions and policy uncertainties.
The UN also revised its 2026 forecast for India slightly lower to 6.4%, yet maintained that the country will continue to lead global growth. This resilience is attributed to strong domestic consumption and sustained government expenditure.
According to the WESP report, India’s economic growth will be supported by robust private consumption, increased public investment, and strong exports in the services sector. While looming U.S. tariffs may weigh on merchandise exports, exempt sectors — such as pharmaceuticals, electronics, semiconductors, energy, and copper — could soften the impact, although these exemptions may not be permanent.
Stable Unemployment, But Gender Gap Persists
The report also highlights stability in India’s job market, with unemployment levels remaining steady due to consistent economic conditions. However, it flags persistent gender disparities in employment as an area needing urgent attention.
New data released by the Ministry of Statistics and Programme Implementation on May 15 shows India’s unemployment rate stood at 5.1% in April 2025 — the first time the figure has been published on a monthly basis through the newly launched Periodic Labour Force Survey (PLFS).
The unemployment rate for men was slightly higher at 5.2%, compared to 5% for women. Youth unemployment (ages 15–29) stood at 13.8% nationally, with urban areas experiencing a sharper rate of 17.2% versus 12.3% in rural regions.
The monthly PLFS replaces the previous quarterly and annual reporting formats, offering a more real-time view of labour market trends.
