Robust consumption bulwark against external shocks: FM Sitharaman

New Delhi: Finance minister Nirmala Sitharaman Friday said India’s economic growth is firmly anchored in robust domestic consumption that blunts the impact of external shocks, and that its evident resilience in the face of global turmoil is “neither accidental nor transient”.

“The Indian economy is resilient and continues to grow sustainably,” she said, adfdressing the first plenary session of the three-day Kautilya Economic Conclave in the capital. “However, just as eternal vigilance is the price of liberty, eternal performance is the price of strategic independence.”

The theme of the annual conclave, organised jointly by the finance ministry and the Institute of Economic Growth, is “Seeking Prosperity in Turbulent Times”.

She said India’s capacity to absorb shocks in times of intensifying geopolitical conflicts, sanctions, tariffs and reshaping of global supply chains remains strong, and that its economic leverage is evolving.

Developing countries, she emphasised, can’t afford to be “passive spectators in a world where decisions elsewhere determine our destinies. We must be active participants, shaping outcomes where possible and preserving autonomy where necessary”.

“Wars and strategic rivalries are redrawing the boundaries of cooperation and conflict. Alliances that once appeared solid are being tested, and new coalitions are emerging. For India, these dynamics highlight both vulnerability and resilience,” Sitharaman noted.

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Power of strategic reforms


“Our choices will determine whether resilience becomes a foundation for leadership or merely a buffer against uncertainty,” she said. Washington has imposed a 50% extra tariff — the highest in the world that applies only to Brazil — on Indian merchandise shipments to the US.

Detailing India’s growth aspirations, Sitharaman said that the country should expand 8% annually in real terms to realise the goal of emerging as a developed nation by 2047. India’s growth hit a five-quarter high of 7.8% in the June quarter. The Reserve Bank of India ( RBI) has projected a 6.8% economic expansion for the current fiscal, against 6.5% in FY25.

The minister said India’s rise results from a combination of factors, including focus on fiscal consolidation, improved quality of capital expenditure, and reining in inflationary pressures over the past decade, she said. “We have implemented strategic reforms that enhance the ease of doing business, promote financial inclusion, and improve the quality of life for the average citizen in the country,” she said.

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New money order


The minister pointed at efforts to re-imagine the global financial system. Innovations like stablecoins are transforming the landscape of money and capital flows, which may force nations to make binary choices: adapt to new monetary architectures or risk exclusion.

“They also remind us that no nation can insulate itself from systemic change. Whether we welcome these shifts or not, we must prepare to engage with them,” she said. She pointed at the rise of Asian nations that have absorbed, for decades, material gains of globalisation without adopting the same political values that underpinned Western society.

“Today, they assert alternative models of growth and governance, drawing on their civilisational continuities. Their emergence questions the assumption that Western liberal values are the only path to economic success,” she said. “The absolute dominance once enjoyed by a hegemon is now contested. Today, we find ourselves in a shifting global landscape that resembles a zero-sum approach, in part, a consequence of the failures and limitations of the era of globalisation that preceded it.”