India's economy enters 2025 in a strong 'Goldilocks' zone with 8% growth and under 2% inflation, defying global headwinds. Despite initial goodwill, US tariffs under Donald Trump's second presidency strained Indo-US economic relations, particularly after steep tariffs were imposed. While the current economic performance is partly statistical, the key question for 2026 is whether domestic growth will be supported by favorable international trade conditions or continue to face global challenges.