IMF Boosts India’s FY26 GDP Growth Forecast to 6.6%: What This Means for the Economy

New Delhi: The International Monetary Fund (IMF) recently raised India’s GDP growth forecast for this fiscal year to 6.6%, up from the earlier estimate of 6.4%. This adjustment stems from strong growth, which has helped counterbalance the impact of US tariffs on Indian exports.

In its latest World Economic Outlook (WEO), the IMF also predicts a slight dip in growth for 2026-27, revising it down by 20 basis points to 6.2%. The report stated, “This is an upward revision for 2025, driven by a robust first quarter performance, which offsets the recent increase in the US effective tariff rate on imports from India.”

India’s economy expanded by 7.8% in the April-June quarter, marking its strongest growth in five quarters despite the looming US tariffs. The World Bank echoed this optimism, boosting its growth forecast for India this year from 6.3% to 6.5%. This positions India as the fastest-growing major economy.

In July, the IMF initially adjusted India’s growth projection to 6.4% for both 2025 and 2026. Earlier in April, the estimates were set at 6.2% for 2025 and 6.3% for 2026. On a global scale, the IMF forecasts a slowdown in growth, predicting it will fall from 3.3% in 2024 to 3.1% in 2026.

This revised outlook is an improvement from previous forecasts made in October 2024. However, it’s still 0.2 percentage points lower than earlier predictions before certain policy changes. The IMF notes that the slowdown reflects ongoing uncertainties and a rise in protectionism, even though the effects of the tariffs are less severe than initially expected.

For emerging markets and developing economies, growth is projected to decrease from 4.3% in 2024 to 4.0% in 2026.

Experts highlight that while these projections are encouraging for India, challenges such as external shocks and domestic issues still loom large. As we navigate this uncertain economic landscape, staying informed about global trends and economic policies can empower us to make better choices, both individually and collectively.

For further details, the comprehensive report by the IMF can be accessed here.

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INDIA GDP, US TARIFFS, IMF, IMF RAISES INDIA'S GDP GROWTH FORECAST TO 6.6 PC FOR FY26