The World Bank’s latest India Development Update, released Tuesday, bumped the country's FY27 GDP growth forecast to 7.1% from 6.6% announced in April—this change follows a 7.8% rise in the first quarter, outpacing the 7.5% consensus.
World Bank economist Sudip Gupta said the surge in private consumption, which grew 7.2% in Q1, is supported by income‑tax relief and GST cuts, while investment climbed 6.5% thanks to policy incentives and a stable credit environment.
India’s exports rose 3.6% year‑on‑year in Q1, beating the 3.2% growth forecast, Trade Minister Piyush Goyal noted, attributing the jump to higher commodity prices and a resilient global demand.
Industrial output accelerated 5.9% in Q1, up from 4.2% the previous year, driven by infrastructure and construction goods; electricity sector growth hit 9.3% versus a 1.5% contraction in 2024, World Bank data shows. Rainfall deficits in August are expected to modestly weigh on rural demand, Gupta added.
The World Bank will issue a full report in June, and Finance Minister Nirmala Sitharaman is slated to present a revised fiscal strategy to the cabinet next Wednesday, aiming to sustain the growth trajectory.