On June 30, 2025, the Reserve Bank of India (RBI) released its Financial Stability Report, highlighting that India’s banking sector remains strong and the overall economy continues to perform well despite global economic pressures.
According to the report, Indian banks’ gross non-performing assets (GNPAs) stood at a multi-decade low of 2.3% as of March 2025. The RBI expects this number to rise slightly to 2.5% by March 2027 if current trends hold. Even under adverse conditions, the GNPA ratio is not expected to go beyond 5.6%, showing how resilient the banking sector remains.
The RBI also reaffirmed its economic growth projections. It expects India’s GDP to grow by 6.5% in fiscal year 2026 and by 6.7% in fiscal year 2027. These numbers reflect strong domestic demand and stable macroeconomic conditions. The central bank said that India’s financial system remains resilient, supported by sound regulations and healthy banking practices.
As part of its efforts to stabilize the currency market, the RBI reduced its short-dollar position in the forex derivative book to $65.2 billion. This marks the third consecutive month of such reduction. In addition, the RBI introduced new rules requiring offshore entities to report rupee-based interest rate derivative trades. This is expected to narrow the gap between offshore and onshore rates and bring more stability and transparency to the rupee market.
With these moves, the RBI under Prime Minister Modi’s leadership continues to take strong steps to ensure India’s economic stability, even as global uncertainties persist.
