The Jan’25 volume of the EcoCapsule recounts the ups and downs of CY24, highlighting that even as growth ended up better than expected during the year, volatility has become persistent. It highlights the risk that several downward factors which were expected to crystallise in CY24 could finally precipitate in CY25. The Report goes on to highlight two developing structural themes – the battle between the USD and its alternates, and the return of mercantilism in a world torn apart by trade war. On the domestic front, growth seems to be barely holding up, with a gradual replacement of government capex by private capex the manna for the economy in CY25. Given the changing growth dynamic, the RBI is likely to change gears on policy during CY25. Further, given currency concerns, ample forex buffers will play a role in combating uncertainty. Balancing the promise of growth with the perils of disruption, only adaptability and resilience can transform this moment of flux into an opportunity to shape the economic destiny.
