New Delhi: In the midst of geopolitical tensions, the Indian energy sector is poised to encounter challenges, while sectors such as consumer goods, automotive, and healthcare are expected to experience significant expansion in 2025, as outlined in the report 'Industry Outlook 2025' by the Economist Intelligence Unit.
The report highlights that the fossil fuel markets are likely to persist in facing geopolitical risks, particularly in the Middle East and Ukraine. Nonetheless, there is a strong expectation for continued investments in renewable energy, especially in China, as the global community moves towards cleaner and more sustainable energy sources.
The report states, "Fossil fuel markets will persist in facing geopolitical risks, yet investments in renewables will remain robust, particularly in China."
Furthermore, the financial sector is projected to have a mixed outlook, with a decline in interest rates expected to narrow profit margins for banks, potentially leading to reduced dividend payments for shareholders. However, regulatory relaxation could offer some relief, with the anticipated completion of the Basel III reforms likely to be further delayed, thereby mitigating the impact on banking institutions amidst an adverse economic environment.
Regarding consumer goods and retailing, the report forecasts a growth in global retail volumes by 2.2 percent in 2025, attributed to easing inflation. Nonetheless, there will be stricter regulations on online retailing aimed at high-volume, low-price retailers, ensuring fair competition and consumer protection.
The report notes, "Global retail volumes will expand by 2.2 percent, attributed to easing inflation, but regulations on online retailing will become more stringent."
In the automotive sector, the report predicts a record-breaking year, with annual new vehicle sales projected to reach a record 97.2 million units in 2025. This includes a 2 percent increase in new car sales, a 4 percent rise in commercial vehicle sales, and a notable 16 percent growth in electric vehicle sales, reflecting the sector's recovery and the shift towards cleaner mobility.
Additionally, the report suggests that more countries will adopt satellite internet, with enterprise clients, including the military and maritime sectors, being the primary users. Amazon's Project Kuiper is expected to challenge the existing market dominance of Starlink and EutelSat OneWeb, thereby introducing more competition and potential growth in satellite connectivity.
The resulting tensions are anticipated to influence investment into production and market entry, with companies leveraging government incentives to develop more flexible supply chains. Investment in technology, particularly in artificial intelligence (AI), is also expected to be robust as projects gain momentum.
However, technology companies are likely to face challenges from various angles, including tightening regulations (especially in Europe), investor impatience for profits, and increased scrutiny on energy consumption.
