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Informist, Friday, Jun. 5, 2026

NEW DELHI – Aditi Nayar, chief economist, ICRA, said the following on India's GDP growth of 7.8% for the March quarter:  

India's GDP growth eased only marginally to 7.8% in the March quarter from the upward revised 8.0% in Oct-Dec, amid a stronger than expected performance of the services sector. This exceeded ICRA's estimate of 7.0% for the quarter, suggesting that the economy did not witness a material impact of the West Asia conflict in the quarter, which began at end-February 2026. 

Given the uncertainty around the resolution of the conflict, elevated energy prices for an extended period pose a downside risk to growth in the near term, including muted prospects for investment demand, negative impact on corporate profitability and dampening consumer sentiment. Besides, the potential development of El Nino conditions and weak monsoon forecast for 2026 have dulled the agricultural outlook and rural demand prospects for Oct-Mar.

Assuming an average crude oil price of $95 per barrel, ICRA pegs GDP growth to slow down to sub-6.5% in 2026-27 from 7.7% in FY26, with the West Asia crisis expected to transmit to lower growth outcomes, particularly in Apr-Sept. However, nominal GDP expansion is set to improve to above 12% in FY27 from 8.9% in FY26, on the back of unpalatably higher inflation.  End

Compiled by Shubham Rana

Filed by Avishek Dutta

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