Why India Will Be Crucial in 2025: Economic Growth, Diplomatic Balance, and Global Influence


  • India, a country that has long been recognized for its demography and its democratic values, has recently undergone significant changes.
  • India’s growth outlook is expected to be double the global growth rate.
  • India’s ability to remain neutral while addressing human rights violations strengthens its diplomatic role in resolving conflicts.
  • India’s vision for 2025 is very clear, and more importantly, the country is in a position where it can not only help itself but also contribute to global stability.

Amid, the geopolitical timeline, where instability has become the new norm of world geopolitics, war and casualties have become the new definition of international relations. Every country is now directly or indirectly involved in conflict, where continental dilemmas have taken over the majority of countries. There are very few nations that remain unaffected. Even if they are not directly involved, their status and potential provide them immunity from external adversities or instabilities. One of the few countries in recent times that has emerged as such is India. India, a country that has long been recognized for its demography and its democratic values, has recently undergone significant changes. What has changed for this country is that its skilled manpower, economic prosperity, and potential now surpass mere numbers. This potential not only gives India opportunities in these turbulent geopolitical times but also offers the world an alternative and options for solving problems.

These very features of India are leading it to pragmatic, useful, and open diplomacy. India is now in a position where it can engage with all its external partners and effectively solve problems. This flexibility, which very few countries possess, places India in a unique position. India is currently able to maintain good relations with all of these countries. This not only offers India the opportunity to deal with multiple options but, more importantly, provides a significant advantage for the world. India is one of the very few countries that can maintain relationships with all these nations, and with the backing of such a country, India can tackle major global problems. This is why India matters in 2025.

India – The Architect of World Growth in 2025

According to the OECD, the world’s annual growth rate for 2025 is expected to be 3.3%, which is just 0.1% higher than the growth rate of 3.2% projected for 2024. However, India’s growth outlook is expected to be double the global growth rate. As per the projections from the RBI, and other sources, India’s growth is forecasted to be between 6.3% and 6.4%. This is twice the global average, and it indicates India’s significant contribution to global growth. More importantly, India’s demand-driven demography is proving to be a key driver of its growth. This not only creates opportunities for Indian companies but also provides ample opportunities for world companies. It is also attracting global companies, as many of the major markets are finding it difficult to generate returns elsewhere. For example, in Germany, investors are increasingly finding it difficult to seek returns because of the recessed economy, whereas India has remained an exception.

India & the Geopolitics 

Amid decades of continuous Western-dominated institutions like the G7 and even the United Nations, which have remained ineffective and incompetent in solving global conflicts, a new association has emerged. This association, formed in 2009, is BRICS. There is ongoing discussion about BRICS being an association with growth opportunities, especially as it represents developing economies. However, recent discussions suggest that BRICS is trying to position itself as an alternative to Western-led organizations. The recent inclusion of countries like Iran into BRICS has led some to believe it could become a counterbalance to the G7. However, India suggests that BRICS becoming an alternative to the West is not its true advantage. The real strength of BRICS lies in maintaining its identity as BRICS, not by trying to emulate any existing organization. As Prime Minister Modi says, BRICS is not anti-West, but a non-Western natural growth model.

However, there has also been a change in India’s attitude towards South Asia. India is considered a natural leader in South Asia, but due to the influence of religious fanatics and vendetta politics in some nations, a few countries in the region have chosen to distance themselves from India. Recent examples include the governments of Bangladesh and the Maldives. In the past, India’s strategy has been to forcefully ask these countries to mend their ways and return to better relations with India. However, recently, India has adopted a more mature and pragmatic stance. Despite its natural leadership role, India has not pressured these countries to align with it. Instead, India continues to act as a supporter, helping countries like the Maldives and others in the region. Because India is too significant to ignore in terms of its economic and political influence, the trend of moving away from India has started to reverse. For instance, the political shift in the Maldives, from distancing itself from India to now fostering better relations, is a clear example of this change.

India & its Attitude to Global Conflicts

In 2025, two major conflicts dominate: the Russia-Ukraine war and the Israel-Palestine conflict. India has taken a pragmatic stance in the Russia-Ukraine war, remaining neutral and advocating for dialogue and cessation. India’s position matters because it is a strategic partner of Russia, with strong diplomatic and personal ties between Prime Minister Modi and President Putin. India’s economic ties with Russia are significant, and it has also maintained relations with Ukraine, being one of the few countries to visit both. This influence allows India to play a key role in resolving the conflict. In April 2022, following the Bucha killings in Ukraine, India was one of the first to call for an independent investigation, demonstrating its neutral yet proactive approach. India’s ability to remain neutral while addressing human rights violations strengthens its diplomatic role in resolving conflicts.

Regarding the Israel-Palestine conflict, India holds a unique position. Prime Minister Modi’s visits to both Israel and Palestine highlight India’s neutrality. While India advocates for the protection of Palestinian lives, it maintains strong ties with both Israel and the Arab world, including Iran. This balanced diplomacy allows India to potentially broker a consensus and contribute to peace efforts.

Conclusion

India’s vision for 2025 is very clear, and more importantly, the country is in a position where it can not only help itself but also contribute to global stability. Whether through its leadership in forums like BRICS, its role in resolving global conflicts, or its efforts to bring stability to the region and the world, India is poised to play a significant role in shaping the future.

References:

  1. https://www.oecd.org/en/about/news/press-releases/2024/12/economic-outlook-global-growth-to-remain-resilient-in-2025-and-2026-despite-significant-risks.htm.
  2. https://m.economictimes.com/news/india/indias-condemnation-of-bucha-killings-not-a-shift-in-ties-with-russia-analyst/amp_articleshow/90707570.cms
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By Aayush Pal

Aayush Pal is a freelance writer on contemporary geopolitical developments. The views expressed in his work are entirely his own.

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