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India Rising Perspective: Inside the $1 Trillion Economy - Issue 1 : Last Friday, we released the very first issue of our new India Rising Perspective. “Tamil Nadu × Europe: A Shared Industrial DNA and the Rise of a Global Electronics Powerhouse” kicked off a four part series by Godson George Micheal Rai and Priyadarshini Samikumar from Guidance Tamil Nadu. Check it out and find my main takeaway at the end.

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India’s GDP grew faster than expected in the last quarter (July to September 2025).

While European economies struggle to find momentum, India remains the fastest growing major economy. According to data by the National Statistics Office (NSO) under the Ministry of Statistics and Programme Implementation (MoSPI) and as reported by The Economic Times, India’s real GDP grew by 8.2% in the last quarter (July to September), beating forecasts and confirming the resilience of India’s economy.

The contrast with Europe is stark. The latest quarterly growth numbers are a strong extension from last year’s 5.6% in the same quarter and are expected to push India’s annual GDP growth above 7%, despite external challenges such as US-imposed tariffs of 50% on Indian exports.

India’s expansion is balanced across all major sectors:

This balanced growth is underpinned by sustained public investment, creating a positive cycle that has kept unemployment stable at 5.2% for October; a critical factor in maintaining consumer confidence and spending.

As high levels remain, latest Purchasing Manager Index (PMI) numbers compiled by S&P Global dropped to 59.9 in November vs. 60.4 in October. While moderately lower, a level above 50 still indicates healthy expansion levels. Manufacturing activity dropped slightly, while service activity increased.

The IMF, in its latest country report, sees room to build on this momentum through targeted structural reforms: meeting the fiscal deficit goal of 4.4% of GDP this year, and ensuring any tariff relief measures remain targeted and time-bound to avoid distorting the market.

Nonetheless, latest GDP growth numbers show that the country is on a good path of economic development. The economy’s resilience and India’s strong domestic market stand in sharp relief against global uncertainty. While other markets, and especially the EU, continue to stagnate or grow moderately, India could be a key market for European businesses to stabilise and enter a new growth phase.

Sources: The Economic Times, Investing[dot]com, Times of India, LiveMint

The European Central Bank (ECB) announced that it intends to connect its TARGET Instant Payment Settlement (TIPS) service with several other fast payment systems to improve cross-boarder payments. To achieve faster, more transparent, and cheaper transactions with India, the ECB intends to integrate India’s Unified Payments Interface (UPI). A development that could reshape how Europe does business with its fastest-growing major trading partner.

UPI was developed by the National Payments Corporation of India and processes over 650 million transaction per day, more than VISA (see India Rising issue 19). After initial announcements in October 2024, the ECB is now finalising legal arrangements and beginning the technical integration work to connect these two payment systems.

There are tangible reasons for the integration of India’s UPI. When France made UPI available at key tourist destinations, it experienced a 40% uptick in Indian travellers to the country thanks to familiar and secure payment processes reducing friction. It's the same dynamic that drove Alipay and WeChat Pay adoption across Europe for Chinese tourists, except UPI's integration with TIPS promises something broader than tourism spending.

The UPI-TIPS connection could fundamentally simplify cross-border transactions between Europe and India. For European businesses operating in India or sourcing from Indian suppliers, this means faster, more transparent, and significantly cheaper payments. For Indian companies expanding into Europe, it removes a major operational hurdle.

The political momentum certainly is real. Last week, I had the opportunity to join the Digital-Dialogue “Wirtschaft stärken, Partnerschaften vertiefen – EU Tech Business Offer und Internationale Digitaldialoge“ in Berlin, an event co-hosted by the German Federal Ministry for Digital Transformation and Government Modernisation and the European Commission. Officials confirmed the EU-India digital partnership is prioritising fintech sector collaboration, with ongoing exchanges specifically focused on UPI integration.

The EU and India are building digital public infrastructure that could set global standards: the EU with its regulatory frameworks and data governance models, India with its scalable, low-cost digital platforms. The UPI-TIPS integration represents a practical test case for how these approaches can complement rather than compete.

Sources: European Central Bank, Travel and Tour World

The Dutch investment group Prosus has been successfully active in India for many years and continues to build its digital ecosystem in the country. Newly announced investments in Rapido and Ixigo make the firm major shareholder in both startups and create opportunities to leverage its investment portfolio. A clear signal for European businesses by one of Europe’s most successful emerging markets investors.

Prosus has built a well-diversified portfolio of more than 30 companies in India over the past decade, with a total investment portfolio exceeding USD 8 billion and forming an interconnected digital infrastructure:

Rapido, a ride-hailing platform moving people comparable to Uber, and Ixigo, an online travel agency comparable to Trip. com, fit well into the company’s ecosystem approach. The company follows a clear long-term strategy and intends to cover how Indian customers shop, eat, pay, move, and travel. The company’s systematic approach to India was confirmed by a recently announced partnership with Accel focused on India’s deep tech sector (see India Rising issue 32).

These investments provide an important signal for European businesses: ecosystems matter and India presents a clear opportunity. Prosus has been highly successful on early bets in other emerging markets such as China before and is famous for its early investment in Tencent (1,000x return). Betting large on India could once again proof being successful, and indicate an underlying market potential many European businesses should secure for themselves as well.

Sources: The Economic Times, Prosus

Germany’s engineering prowess is globally recognised, but German companies are increasingly driving innovation not from Stuttgart or Munich, but from Bengaluru, Pune, or Hyderabad.

I had the great opportunity to contribute to GCC Pulse™, a leading media platform on the Global Capability Center (GCC) ecosystem, and share some insights on the Indo-German landscape.

You can find the full article here:

Your random facts and stories about India and the Indo-European friendship.

This week: Why India Leapfrogged Europe in Digital Payments

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