Chief Economists Outlook May 2025

19Chief Economists Outlook 45 Bajpaee, C. (2025). 46 International Monetary Fund (IMF). (2025b). 47 The Economist. (2025i).48 S&P Global & HSBC. (2025, 23 April). 49 Sheppard, D. et al. (2025).Figure 17. South Asia in the remainder of 2025 Economic growth Very weak Weak Moderate Strong Very strong Inflation Fiscal policy Monetary policyVery low Low Moderate High Very high Looser Unchanged Tighter Looser Unchanged Tighter3 61 13 31 48 48 366 3269 55 30 3 Source: Chief Economists Survey. (2025, April).South and Central Asia The growth outlook for South Asia has been robust despite a challenging global environment. Among all regions, chief economists surveyed are most optimistic about South Asia’s prospects, with one- third (33%) expecting strong or very strong growth for the remainder of 2025. However, the region’s immediate challenges intensified in early May with the outbreak of military exchanges between India and Pakistan.45 Across the region, chief economists expect moderate (61%) to high (26%) inflation. India, the region’s largest economy, looked set to be the primary engine of growth, with GDP expansion forecast by the IMF at 6.2% for 2025 and 6.3% in 2026.46 Although the rerouting of Chinese exports is casting a shadow over the region’s economic prospects,47 recent purchasing managers’ index (PMI) data surpassed expectations and showed unprecedented growth of new export orders.48 A recently concluded trade deal between India and the UK is another source of optimism.49 Figure 18. Central Asia in the remainder of 2025 Economic growth Very weak Weak Moderate Strong Very strong Inflation Fiscal policy Monetary policyVery low Low Moderate High Very high Looser Unchanged Tighter Looser Unchanged Tighter26 83 14 31 38 6269371 3 Source: Chief Economists Survey. (2025, April).