GDP growth view
IMF raises India FY26 GDP growth forecast to 6.6% but cuts FY27 view to 6.2%
This story was originally published at 18:36 IST on 14 October 2025
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--IMF raises India's GDP growth forecast for FY26 by 20 bps to 6.6%
--IMF cuts India's GDP growth forecast for FY27 by 20 bps to 6.2%
--IMF: Raised India FY26 GDP view on strong Q1 offsetting higher US tariffs
--IMF: See India FY26 CPI inflation at 2.8%, FY27 at 4.0%
--IMF raises global GDP growth forecast for 2025 by 20 bps to 3.2%
--IMF raises US' GDP growth forecast for 2025 by 10 bps to 2.0%
--IMF retains China's GDP growth forecast for 2025 at 4.8%
NEW DELHI – The International Monetary Fund has raised its forecast for India's GDP growth for the current financial year ending March by 20 basis points to 6.6%. At the same time, the Fund has lowered the growth forecast for FY27 by 20 bps to 6.2%.
The IMF raised India's growth forecast for FY26 mainly because of a five-quarter high growth of 7.8% in the June quarter. The "carryover from a strong first quarter" more than offsets the increase in the US tariffs on imports from India, the IMF said in its October edition of the World Economic Outlook report.
The IMF follows the World Bank and the Reserve Bank of India in raising the growth projection for the current financial year. The World Bank last week raised its forecast for India's FY26 GDP growth by 20 bps to 6.5%. The RBI earlier this month pegged its FY26 growth forecast at 6.8%, higher than the 6.5% projected earlier.
Growth is seen lower next year because of the 50% tariff imposed by the US on Indian exports. The 50% tariff on India is one of the highest in the world, even as New Delhi and Washington are working on a bilateral trade agreement. "Compared with the pre-tariff forecast in October 2024, growth is projected to be cumulatively 0.2 percentage point lower," the IMF said.
The Fund sees CPI inflation averaging 2.8% in FY26, 20 bps higher than the RBI's forecast of 2.6%. CPI inflation declined to a 99-month low of 1.54% in September and is expected to fall below 1% in October because of a high base effect and the reduction in goods and services tax rates. For FY27, the IMF sees India's CPI inflation at 4.0%. CPI inflation in India was 4.6% in FY25.
The IMF raised its forecast for global growth for 2025 by 20 bps to 3.2% and left the 2026 forecast unchanged at 3.1%. Global growth was 3.3% last year. "The growth forecast is little changed from the July 2025 WEO Update, reflecting gradual adaptation to trade tensions, but is decisively below the pre-pandemic average of 3.7 percent," the IMF said.
The Fund raised the US GDP growth forecast for both 2025 and 2026 by 10 bps to 2.0% and 2.1%, respectively. It retained China's growth forecast for 2025 at 4.8% and for next year at 4.2%. End
Reported by Shubham Rana
Edited by Deepshikha Bhardwaj
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