World Bank Raises India’s FY27 Growth Forecast to 6.5%

The World Bank has upgraded India’s GDP growth forecast for FY27 to 6.5%, from 6.3% projected in October 2025, citing stronger domestic demand and resilient exports.

• Forecast unchanged compared to June 2025
• India expected to remain the fastest-growing major economy

Key Drivers Behind the Upgrade

1. Resilient Domestic Demand

• Consumption and investment momentum stronger than earlier expected
• Improved business and consumer confidence

2. Export Performance

• Exports more resilient despite:
  • Higher U.S. tariffs on some Indian goods
  • The U.S. accounts for ~12% of India’s merchandise exports
• Services trade surplus continues to cushion merchandise trade deficit

Medium-Term Outlook

• FY28 growth projected at 6.6%
• Supported by:
  • Robust services sector
  • Export recovery
  • Pickup in investment