HOME > MARKETS > ECONOMY NEWS
  ECONOMY NEWS
ECONOMY
India's GDP likely to grow 6.5% in FY26: S&P
Nov-24-2025

S&P Global Ratings in its Economic Outlook Asia-Pacific report has projected India's gross domestic product (GDP) to grow 6.5 per cent in the current fiscal year (FY26) and 6.7 per cent in the next, saying tax cuts and monetary policy easing will give a boost to consumption-driven growth. India's real GDP is estimated to have grown at the fastest pace in five quarters at 7.8 per cent in the April to June period of current fiscal year.  

S&P said if India can secure a trade agreement with the US, it will reduce uncertainty and enhance confidence, which would boost labour-intensive sectors. It noted that lowered goods and service tax (GST) rates will support middle-class consumption and complement income tax cuts and interest rate reductions introduced this year. It said these changes are likely to make consumption a greater driver of growth compared with investment, in this fiscal year, and the next.

It further said the spike in the effective US tariff on India is weighing on the expansion of export-oriented manufacturing in the country. But there are signs the US may lower tariffs on Indian products. It added that the US' new approach to trade policy is causing governments and firms to spend time and money on negotiating for exemptions, consequently diverting attention from efforts to raise productivity.


  RELATED NEWS >>