Why in News?
In July 2026, the Asian Development Bank (ADB) released the ADB India Economic Outlook 2026. ADB revised India’s GDP growth forecast for FY2026-27 (FY27) downward to 6.6% from 6.9% (April 2026 forecast), mainly due to high energy prices impacting household consumption.
India-Specific Highlights
- FY27 GDP Growth: 6.6% (Earlier: 6.9%)
- FY28 GDP Growth: 7.3% (Unchanged)
- Reason for FY27 downgrade: Rising energy prices reducing household purchasing power.
- FY28 outlook: Supported by policy measures, stronger exports, and improving global economic conditions.
India’s Inflation Forecast
| Financial Year | Inflation Forecast |
|---|---|
| FY27 | 5.2% (Earlier: 4.5%) |
| FY28 | 4.0% (Unchanged) |
Reason for Higher Inflation:
- Higher global crude oil prices.
- Depreciation of the Indian rupee.
- Persistent food inflation.
FY28 Forecasts
- India: 7.3% (Unchanged)
- Developing Asia-Pacific: 5.1% (Unchanged)
Reasons for India’s Growth Downgrade
- Rising energy prices.
- Pressure on household incomes and consumption.
- Higher inflation.
- Global economic uncertainties.
About Asian Development Bank (ADB)
| Feature | Details |
|---|---|
| Established | 1966 |
| Headquarters | Manila, Philippines |
| Members | 69 (49 regional, 20 non-regional) |
| India Joined | 1966 (Founding Member) |
| President | Masato Kanda |
