World Bank raises India FY27 GDP growth forecast by 10 bps to 6.6%
This story was originally published at 20:32 IST on 8 April 2026
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--World Bank:Invest growth in India likely to moderate amid high uncertainty
--World Bank: High energy prices to hit Indian households' disposable income
--World Bank: India FY27 inflation to rise on higher energy prices
--World Bank: India FY27 inflation to rise on normalising food prices
--World Bank raises India FY27 GDP growth forecast by 10 bps to 6.6%
NEW DELHI – The World Bank on Wednesday raised its forecast on India's GDP growth in 2026-27 (Apr-Mar) by 10 basis points to 6.6%. This is, however, lower than the estimated 7.6% growth in FY26, the multilateral agency said in a report. "Growth is projected to decelerate to 6.6 percent in FY27, reflecting headwinds from the Middle East conflict," the report said.
The World Bank's growth projection is below the Reserve Bank of India's forecast of 6.9% for FY27.
The impact of the conflict is highly uncertain, with other forecasters revising down their growth projections to a range between 5.9% and 6.7%, it said. In January, the World Bank had raised its forecast for India's GDP growth in FY26 by 70 bps to 7.2% on the back of robust domestic demand. It had also raised the growth forecast for FY27 to 6.5% from 6.3% and pegged FY28 growth at 6.6%.
The World Bank report said that although the reduction in goods and services tax rates should continue to support consumer demand in the first half of FY27, elevated global energy prices are expected to put upward pressure on prices and constrain households' disposable income. "Government consumption growth is expected to soften to offset higher subsidy outlays for cooking fuel and fertilisers. Investment growth is likely to moderate amid elevated uncertainty and rising input costs. Improved access to the US and the European Union for India's exports will be undermined by slower growth in major trading partners," it said.
The war in West Asia, which began on Feb. 28, has increased India's exposure to energy and price shocks, given India's dependence on crude oil and liquefied petroleum gas supplies from the region. Crude oil prices, a key determinant of government subsidies, have soared since the war broke out.
"In India, sectoral growth has been supported by an increasing contribution from higher-value activities such as horticulture, livestock, and fisheries. For traditional crops, record kharif (monsoon-dependent crops sown in the summer) and rabi (sown in winter) sowings in the 2024–25 crop year supported rural incomes and kept food price inflation low in late 2025 and early 2026."
India's free trade agreements with the European Union and the UK are expected to result in consumption and real income gains for households across the entire income distribution, the multilateral agency said. End
Reported by Sagar Sen
Edited by Saji George Titus
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