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India’s economy continues to recover steadily from the pandemic, standing out as one of the most dynamic among major global economies. After weathering the downturn caused by the COVID-19, New Delhi has returned to a high-growth trajectory. However, sustaining this momentum depends on resolving structural bottlenecks, most notably those related to energy. These challenges were the focus of discussions at the India Energy Week forum held in Goa at the end of January.
India’s Ascent in the Global Rankings
India has consistently posted real GDP growth above 7% in recent years, propelling it into the world’s top five economies after overtaking the UK. In June 2025, India surpassed Japan to become the world’s fourth-largest economy. According to S&P Global, growth is expected to remain robust at around 6.5% in 2026. IMF projections suggest that India’s GDP could reach $5 trillion by 2027, with growth potentially accelerating to 7.4%. By 2028, India could surpass Germany.
Large-scale digitalization and the expansion of IT services sector have been decisive drivers of India’s acceleration. According to data from the Ministry of Electronics and Information Technology, the digital economy accounted for 11.74% of national income, or approximately $402 billion, in 2022–23. It is expected to contribute roughly 20% of GDP by 2030, surpassing traditional pillars such as agriculture.
The IT and business process management (IT-BPM) sector remains a cornerstone of this transformation. From 2024 to 2025, exports from this sector increased by approximately 12.5% to $224.4 billion, solidifying its position as a major source of foreign exchange and employment. Looking ahead, cumulative investments of $15–25 billion by 2030 could further solidify India’s position as a global digital services hub.
Industrial production has also strengthened. By the end of 2025, year-on-year growth had reached 7.8%, marking the strongest performance in several years. Consumer goods, electronics, and capital goods all experienced double-digit growth, reflecting recovering domestic demand and deeper integration across industrial value chains. While this resurgence has reinforced the economy’s diversification, it has also intensified pressure on infrastructure and energy supply.
Ambitions Depend on Stable Power
India’s rapid economic expansion has sharply increased energy demand. This is particularly evident in the digital sector, where data centers, cloud platforms, and AI infrastructure require uninterrupted and affordable power. Even brief disruptions can undermine the competitiveness of Indian technology firms operating in global markets.
Traditional industries are equally exposed. Manufacturing, transportation, and metallurgy are highly sensitive to oil and gas prices, which have become more volatile due to armed conflicts, sanctions, and trade restrictions that are reshaping global supply chains.
In 2025, India consumed approximately 5.7 million barrels of oil per day. Demand is projected to increase to 5.9 million barrels per day in 2026 and 6.7 million barrels per day by 2030. However, up to 95% of crude oil is imported. Roughly half of these imports come from OPEC suppliers, including Iraq, Saudi Arabia, the United Arab Emirates (UAE), and Kuwait, while about 35% come from Russia.
Against the backdrop of sanctions, geopolitical fragmentation, and armed conflicts, volatility in global energy markets poses a direct challenge to India’s growth strategy. Therefore, ensuring energy sovereignty has become central to New Delhi’s economic planning.
India Energy Week
The India Energy Week forum in Goa highlighted this strategic shift. The government outlined plans to attract up to $500 billion in investments for energy infrastructure, including oil refining, liquefied natural gas (LNG) capacity, and transportation networks. Expanded hydrocarbon exploration was also identified as a priority to mitigate long-term vulnerability.
Several concrete agreements reinforced these ambitions. For example, ONGC signed contracts with Japan’s Mitsui O.S.K. Lines and South Korea’s Samsung Heavy Industries to build two offshore vessels, which will strengthen maritime logistics that are critical to energy security. Bharat Petroleum Corporation Limited (BPCL) concluded a deal with Brazil’s Petrobras to supply 12 million barrels of crude oil, valued at approximately $780 million, for delivery in 2026–27. This deal signals a diversification of suppliers beyond traditional sources. The UAE confirmed a long-term LNG agreement with India valued at approximately $3 billion, providing 0.5 million tons per year from 2028 to 2038.
Taken together, these initiatives reflect a broader strategic objective of reducing exposure to global shocks while positioning India as a regional energy hub. By diversifying suppliers, investing in infrastructure, and expanding domestic capacity, New Delhi aims to shield its economy from the indirect effects of sanctions and trade wars that increasingly affect Global South economies. As geopolitical turbulence intensifies and the global economy fragments, India is consolidating its image as one of the most attractive large markets for investment.
These pieces are being published as they have been received – they have not been edited/fact-checked by ThePrint.