IMF trims India’s 2026 growth forecast to 6.4%, raises 2027 outlook to 6.7%

The International Monetary Fund (IMF) has marginally lowered India's real GDP growth forecast for 2026 to 6.4%, down by 0.1 percentage point from its April projection, citing a more challenging global environment marked by geopolitical tensions and trade uncertainty. At the same time, the Fund upgraded India's 2027 growth forecast to 6.7%, signalling confidence in the country's medium-term economic prospects.

In its latest World Economic Outlook (WEO) Update, the IMF said India would remain among the world's fastest-growing major economies, supported by resilient private consumption and a strong services sector despite global headwinds.

The revised projections come as the global economy navigates the impact of heightened geopolitical tensions, volatile commodity prices and evolving trade dynamics. The IMF retained its global growth forecast at 3.0% for 2026 and 3.4% for 2027, noting that the adverse effects of conflict and policy uncertainty are being partly offset by stronger investment linked to artificial intelligence and digital technologies.

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The Fund's latest assessment suggests that while India's near-term growth outlook has softened marginally, its medium-term momentum remains intact. The upward revision for 2027 reflects expectations that domestic demand will remain robust even as global conditions gradually stabilise.

The IMF also noted that India continues to be among the best-performing large economies, with growth underpinned by domestic consumption and services activity. However, it cautioned that global risks, including geopolitical tensions, trade fragmentation and financial market volatility continue to cloud the outlook for emerging markets.

The IMF is scheduled to release its next comprehensive World Economic Outlook during the Annual Meetings later this year in Thailand, when it will provide an updated assessment of global and country-specific growth prospects.

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