More Stories

Informist, Tuesday, Jan. 13, 2026

 

Please click here to read all liners published on this story

--World Bank raises India's FY26 GDP growth forecast by 70 bps to 7.2%
--World Bank raises India's FY27 GDP growth forecast by 20 bps to 6.5%
--World Bank projects India's FY28 GDP growth at 6.6%
--World Bank: High US tariffs to weigh on India's goods exports, GDP growth
--World Bank: India's FY26 GDP growth supported by robust domestic demand
--World Bank: Strong domestic demand in India to offset US tariff impact
--World Bank: Fiscal consolidation to continue in India
--World Bank: India's public debt-to-GDP ratio to fall gradually
--World Bank: Inflation in India to converge to RBI's 4% aim in FY27

 

NEW DELHI – The World Bank has raised its forecast for India's GDP growth in the current financial year by 70 basis points to 7.2% on the back of robust domestic demand. The World Bank also raised the growth forecast for FY27 to 6.5% from 6.3% and pegged growth for FY28 at 6.6%.

 

"In India, growth is estimated to increase to 7.2 percent in fiscal year (FY) 2025/26 (April 2025 to March 2026), as domestic demand has remained robust, reflecting strong private consumption, supported by earlier tax reforms and improvements in real household earnings in rural areas," the World Bank said in the latest Global Economic Prospects report released Tuesday.

 

The multilateral institution said India is expected to maintain the fastest growth rate among the world's large economies despite 50% tariffs on exports to the US. While the high US tariffs are set to dampen India's goods exports and weigh on overall growth, the adverse impact will be offset by stronger momentum in domestic demand and more resilient exports than previously anticipated, the World Bank said.

 

According to the government's first advance estimate released Wednesday, India's GDP growth for FY26 is projected at 7.4%. In December, the Reserve Bank of India had projected FY26 GDP growth at 7.3%.

 

India's GDP growth is seen at 6.6% in FY28, underpinned by robust services activity and a recovery in exports and a pickup in investment, the World Bank said.

 

The World Bank said inflation in India is expected to converge to the RBI's 4% target in FY27, assuming stable seasonal conditions contain food price inflation. CPI inflation rose to 1.33% in December and the RBI projects it to average 2.0% in FY26.

 

Fiscal consolidation is set to continue in India over the next few years, with the "effects of tax cuts outweighed by a decline in current spending, resulting in a gradual reduction in the public debt-to-GDP ratio", the World Bank said.

 

The government has set a fiscal deficit target of 4.4% of GDP for FY26. From FY27, the government will target the debt-to-GDP ratio, which it aims to bring down to 50% by March 2031, with a band of 100 basis points on either side. The government's debt-to-GDP ratio is seen falling to 56.1% in FY26 from 57.1% in FY25.  End

 

Reported by Shubham Rana

Edited by Rajeev Pai

 

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

 

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd. by NSE Data & Analytics Ltd., a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt. Ltd.

 

Informist Media Tel +91 (22) 6985-4000

Send comments to feedback@informistmedia.com

 

© Informist Media Pvt. Ltd. 2026. All rights reserved.