Harvard study: India stands alone in outpacing pre-Covid economic trends

New Delhi: In a stark illustration of economic resilience, Harvard Professor Jason Furman has spotlighted India as the world's standout performer in real GDP growth since the Covid-19 pandemic, outpacing even powerhouses like the US and China.  

A compelling graph shared by Furman, plotting real GDP as a percentage of pre-pandemic trends from 2019 to 2025 Q3, paints a vivid picture; while most major economies grapple with lingering scars from the 2020 downturn, India's growth surges upward, crossing the zero baseline and climbing toward + 5 per cent by mid-2025.

The chart, which Furman has referenced in recent analyses of global recoveries, tracks five key players; the United States (blue), Euro Area (green), China (gray), Russia (orange), and India (green -- distinct by its upward trajectory).

All nations plunged into negative territory in 2020, with the Euro Area dipping to - 25 per cent, the US to - 5 per cent, and China to - 10 per cent.

Recovery paths diverged sharply thereafter.

The US rebounded swiftly, hovering around + 2 per cent by 2025, buoyed by aggressive fiscal stimulus like the American Rescue Plan, which Furman credits for minimising "scarring" compared to weaker responses elsewhere.

Yet, India's ascent is unparalleled.

From a - 5 per cent trough in 2020, its GDP relative to trend rocketed past pre-Covid levels by 2022, reaching + 3 per cent in 2024 and projected to hit + 5 per cent in 2025 Q3.

This marks India as the only economy not just recovering, but meaningfully exceeding its long-term path -- a feat Furman attributes to structural strengths rather than one-off boosts.

"India's policies fostered domestic consumption and investment amid global headwinds," Furman noted in a recent X post, contrasting it with Europe's energy shocks and China's property crisis.

China's gray line, for instance, stabilises at - 5 per cent by 2025, hampered by zero-Covid lockdowns and real estate woes.

Other Economies

Russia's orange curve flat-lines near - 8 per cent, battered by sanctions post-Ukraine invasion.

The Euro Area, still at - 3 per cent, contends with inflation and geopolitical fallout.

Even the US, while robust, relies heavily on AI-driven data center investments -- accounting for 92 per cent of first-half 2025 growth, per Furman's calculations -- raising questions about sustainability.

Economists hail India's momentum as a blueprint for emerging markets.

Robust digital infrastructure, a young demographic dividend, and reforms like production-linked incentives have fuelled 7-8 per cent annual growth, per IMF estimates.

Exports in electronics and pharmaceuticals hit record highs, while services like IT outsourcing weathered global slowdowns. In fact policies and fiscal prudence of Indian government contained the fiscal deficits below 6 per cent of GDP -- allowed room for targeted spending on infrastructure and social safety nets.

Furman's graph underlines a pivotal shift; as advanced economies flirt with stagnation, India eyes $5 trillion GDP status by 2027.

In Furman's words, shared amid US debates on fiscal policy, "most countries saw quick bounces, but only a few truly outgrew the trauma. India leads that pack". As 2025 closes, the chart's message is clear -- resilience isn't rebounding; it's redefining the future.