World Bank Raises India Growth Forecast to 6.6%
The World Bank has raised its forecast for India’s economic growth in FY2026-27 to 6.6%, from an earlier 6.3%, citing strong domestic demand and the impact of free-trade agreements. The World Bank expects India to remain the primary engine of growth in South Asia. Its April 2026 India Development Update had also projected 6.6% growth for FY27, while estimating that India’s growth had accelerated to 7.6% in FY2025-26 from 7.1% in FY2024-25.
The World Bank’s assessment points to strong domestic consumption and resilient exports as important supports for India’s growth outlook. The latest assessment comes despite external challenges, including geopolitical tensions and uncertainty around global trade and energy markets. India’s strong macroeconomic buffers are expected to provide some protection against external shocks, although higher energy prices and prolonged disruptions could weigh on future activity.
For the banking and financial-services sector, stronger economic growth could support credit demand, investment activity and financial intermediation, while continued external volatility makes prudent risk management important. India’s real GDP subsequently recorded 7.8% growth in Q1 FY2026-27, according to government data, indicating continued momentum at the start of the current financial year.
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