The IMF’s growth projection for India is 7.0 per cent for calendar year 2026 and 6.4 per cent for calendar year 2027.
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Kagenmi
The International Monetary Fund (IMF) on Wednesday lowered India’s growth forecast for the current fiscal 2026-27 by 10 basis points to 6.4 per cent. However, it has retained the tag of fastest growing economy for the country and upped the growth projection for the next fiscal 2027-28 by 20 basis points to 6.7 per cent.“India remains among the fastest growing major economies, with growth projected at 6.4 per cent, supported by strong momentum in private consumption and services activity,” IMF said in its latest update on World Economic Outlook (WEO).In its April edition, the institution had revised the growth estimates upward moderately by 0.3 percentage point (0.1 percentage point relative to January) to 6.5 per cent, led by positive contributions from the carryover of the strong 2025 out-turn and the decline in additional US tariffs on Indian goods from 50 per cent to 10 per cent, which outweighed the adverse impact of the West Asia conflict.Meanwhile, the IMF’s growth projection for India is 7.0 per cent for calendar year 2026 and 6.4 per cent for calendar year 2027.IMF’s projection for FY27 is on the lower side as compared to other agencies. Driven by de-escalation optimism surrounding the US-Iran interim agreement, HDFC Bank recently upgraded India’s FY27 growth forecast by 20 basis points to 6.7 per cent. The revision led a series of new projections, with S&P Global setting its headline growth figure at 6.6 per cent and Bank of Baroda estimating the trajectory to settle between 6.4 per cent and 6.6 per cent as maritime trade routes normalise.All these projections are lower than FY26 print of 7.7 per cent. However, while IMF’s latest print is lower than RBI’s revised projection of 6.6 per cent, all others are close to or at par with the central bank number, revised last month.Outlook for the WorldTalking about the global economy, WEO said that it is in crosscurrents of war and technology. “Global growth is projected to be 3.0 per cent in 2026 and 3.4 per cent in 2027, down from the average of 3.5 per cent observed in 2024–25 and broadly unchanged on a cumulative basis compared with the forecasts in the April 2026 World Economic Outlook (WEO),” it said. The modest slowdown reflects the effects of the war in the Middle East being partly offset by accelerated demand-driven momentum in the global technology cycle thanks to advances in artificial intelligence (AI) and its adoption.Further, the impact varies widely based on the countries’ exposure to the war and position in the technology value chain. Energy exporters outside the conflict zone benefit from favourable terms of trade, whereas economies plugged into the technology-led upturn experience stronger activity even if they are energy importers. In contrast, activity weakens for energy importers with limited participation in the technology value chain, a group that includes many low-income countries.“Global headline inflation is expected to increase from 4.1 per cent in 2025 to 4.7 per cent in 2026 before declining to 3.9 per cent in 2027. Slightly revised upward from April, these projections indicate that the disinflation trend in place since the beginning of 2024 has stalled. Risks to the outlook are more balanced than in April but still tilted to the downside, WEO said.Published on July 8, 2026
