The International Monetary Fund (IMF) forecast India’s economy to expand by 6.6% in 2025-26, a 20-basis-point rise from its previous forecast. The upward revision reflects robust first-quarter performance in FY26, which helped to offset the impact of increased US tariffs on Indian exports. With this projection, India is expected to outperform China’s growth of 4.8%, retaining its status as one of the fastest-growing big economies.
Despite persisting global uncertainty and trade realignments, the IMF emphasised India’s consistent domestic demand, policy stability, and solid economic fundamentals as driving forward movement. Growth in 2026-27 is likely to decrease slightly to 6.2% as early fiscal momentum fades.
On a broader scale, the IMF predicts global growth of 3.2% in 2025 and 3.1% in 2026, with inflation steadily declining. Among advanced economies, Spain is expected to expand the fastest, at 2.9%, followed by the United States at 1.9%. The IMF cautioned that prolonged trade frictions, protectionist policies, and job disruptions could jeopardise global stability. It recommended that countries rebuild fiscal buffers, maintain central bank autonomy, and implement structural reforms.
India’s Economic Survey forecasts GDP growth of 6.3% to 6.8% in FY26, showing confidence in domestic consumption and investment resilience.
