New Delhi, July 9 (IANS). India’s economy will grow at 6.6 percent in FY27. Despite global challenges, India will remain among the world’s fastest growing major economies on the back of policy measures and strong exports of services. This information was given in a report.
The Asian Development Bank (ADB) reported that its revised growth rate projection for fiscal year 2027 is higher than the International Monetary Fund’s (IMF) recent estimate of 6.4 percent.
“Growth will be boosted by policy changes to attract more foreign capital, fuel tax cuts, particularly targeted credit support, stronger services exports, and public capital spending,” ADB said.
ADB also retained the FY28 growth forecast for India at 7.3 percent, which is the same as its April estimate.
ADB said the medium-term outlook is supported by improving global conditions and export competitiveness derived from trade agreements with various partner countries.
According to the report, the growth forecast for FY27 was reduced due to increased energy prices, as they reduce people’s real income and impact consumer spending.
The bank warned that risks to the outlook are still tilted to the downside due to rising geopolitical tensions and weather-related weakness in farming.
ADB also changed India’s inflation forecast for FY27 to 5.2 percent, while maintaining its inflation forecast for FY28 at 4 percent.
ADB has reduced the growth rate forecast for South Asia in 2026 to 6.0 percent from the earlier 6.3 percent. Reasons cited behind this are high oil prices, increasing cost of freight and uncertainty regarding the flow of remittances (money sent from abroad).
For developing Asia and the Pacific, the bank has reduced its 2026 growth forecast to 4.9 percent from 5.1 percent. The bank says the long-running conflict in West Asia has disrupted energy supplies and supply chains, increasing production costs and slowing economic activity.
Despite near-term challenges, ADB said India’s growth outlook remains one of the strongest in the world. It is being supported by continuous reforms, government investment and strong services exports.
–IANS
abs
