World Bank officials announced on Tuesday that it has lifted its forecast for India’s fiscal‑year 2027 GDP growth to 7.1%, up 0.5 points from 6.6% in April. The revision follows data showing domestic demand holding firm amid trade and geopolitical uncertainties.
India’s growth accelerated to 7.8% in FY26, up from 7.2% in FY25, driven by a surge in investment and robust private consumption. The country’s industrial output outpaced expectations, while exports outperformed projections, bolstering the revised outlook.
The World Bank cautions that external headwinds remain high, with oil price volatility, the El Niño weather pattern, and potential stock‑market corrections posing downside risks to capital flows.
Rural consumption outpaced urban demand early in the year, buoyed by a strong agricultural harvest, before urban spending picked up after income‑tax relief and GST cuts. A small shopkeeper in Jaipur said the tax cut helped keep his sales steady during the monsoon lull.
Other multilateral agencies—ADB, OECD, Fitch—also nudged India’s FY27 growth forecast to around 7%, citing resilient domestic demand and steadier supply chains despite Middle East tensions. The World Bank will present the updated data in its upcoming annual meeting in Washington, where policymakers and investors will decide whether to align fiscal stimulus with the new trajectory.