14.10.202523:55:52UTC+00IMF Raises India’s FY2025/26 GDP Forecast to 6.6%

The International Monetary Fund (IMF) has revised India's growth forecast upwards, predicting a 6.6% expansion for the fiscal year 2025/26, an increase from the previous projection of 6.4%. This adjustment reflects India's robust economic momentum, which is anticipated to counteract the effects of heightened US tariffs on Indian products. In its World Economic Outlook report, the IMF attributed the upward revision to a "carryover from a strong first quarter," which is sufficiently influential to surpass the challenges posed by the increase in the US effective tariff rate on Indian imports since July. India's GDP saw an impressive growth of 7.8% from April to June, marking the highest in five quarters, largely fuelled by vigorous private consumption despite a lacklustre export forecast due to US President Donald Trump's imposition of steep 50% tariffs. Nevertheless, the IMF has adjusted its growth projection for FY2026/27, reducing it by 0.2 percentage points to 6.2%. This revision by the IMF follows a similar move by the World Bank, which also increased its growth forecast for India's FY2025/26 to 6.5% from 6.3%, while concurrently lowering its view for the subsequent fiscal year by 20 basis points to 6.3% due to the repercussions of US tariffs.