External risks: US trade policy may affect economic growth in FY26

The financial year 2024-25 (FY25), which is ending this week, has arguably seen economic growth return to normal levels. According to the National Statistics Office’s second advance estimates, the Indian economy is estimated to have grown 6.5 per cent in FY25 as against 9.2 per cent in the previous financial year. The average growth rate between FY22 and FY24 was 8.8 per cent, partly driven by the low base of the pandemic year. The average growth rate between FY13 and FY20 was 6.6 per cent. Thus, it is no surprise that several forecasters expect the growth rate to be around