India became the super engine of Asia's growth, ADB told how its strength increased?
In an update to its Asian Growth Outlook, the ADB said growth is now projected at 5.1 percent in 2025, up from the 4.8 percent forecast in September, and also higher than the 4.9 percent forecast when the report was first released in April.
Until a few years ago, China and Japan were considered the superengines of Asia's growth. Now, India and Vietnam have replaced these two countries.
These two countries have the best performance in the entire Asian region, a feat no other country has. India deserves special mention here, and there's a reason for this. India's economic growth figures in the second quarter were over 8 percent. This clearly means that India is contributing the most to Asia's growth.
This is also the reason why the Asian Development Bank has increased its growth forecast for Asia. Let us tell you what kind of data the Asian Development Bank has presented regarding Asia and India.
Asia getting back on track
In an update to its Asian Growth Outlook, the ADB said growth is now projected to reach 5.1 percent in 2025, up from the 4.8 percent forecast in September and the 4.9 percent estimate when the report was first released in April.
Citing reduced trade uncertainty following several US agreements, the bank raised its 2026 growth forecast for the sector to 4.6 percent from 4.5 percent. The region includes 46 economies, from China and India to Georgia and Samoa, but excludes Japan, Australia, and New Zealand.
The ADB said that while regional growth is expected to moderate next year, strengthening exports due to the uptick in AI and electronics cycles will help sustain economic activity, while also reducing trade uncertainty.
The report said that a potential re-escalation of tariffs and trade policy uncertainty, as well as increased financial market volatility, remain significant downside risks for the future.
South Asia's growth picks up
Subregional prospects have also improved, with South Asia expected to grow at 6.5 percent this year, up from a previous estimate of 5.9 percent, and India beating its forecast of 8.2 percent growth for its second fiscal quarter ending in September.
Southeast Asia is expected to grow at 4.5 percent this year, up from 4.3 percent previously, and to reach 4.4 percent in 2026, but risks remain from global uncertainties, climate disruptions, and domestic political developments, the ADB said.
Recent events underscore these vulnerabilities, with devastating floods in Indonesia, Thailand, and Malaysia in late November killing hundreds and displacing millions.
Meanwhile, fighting has also flared up again between Thailand and Cambodia, with border clashes and airstrikes renewed this week, derailing a fragile ceasefire brokered by US President Donald Trump after a five-day war in July.
The crisis continues in China
China's 2025 forecast has been raised to 4.8 percent from 4.7 percent, still below Beijing's target of 5.0 percent, while the 2026 forecast is unchanged at 4.3 percent, reflecting continued weakness in the country's property market.
The ADB said a persistent slowdown in the property sector is impacting activity, with a sharp decline in property investment leading to a decline in fixed asset investment and a slowdown in infrastructure and manufacturing investment.
The ADB said inflation is projected to decline from 1.7 percent estimated in September to 1.6 percent in 2025, before rising to 2.1 percent in 2026.