The Organization for Economic Co-operation and Development (OECD) raised its GDP growth outlook for India in 2026 to 7.1% from its previous 6.3% forecast, according to the organization's updated economic outlook published Wednesday.
The projected GDP growth, however, is still down from the 7.8% expansion in 2025.
The organization also upgraded its 2027 growth forecast for India by 0.1 percentage point to 6.5% from the June forecast.
It expects headline inflation in India to accelerate to 4.7% this year from 2.1% in 2025. The forecast was down from the previous 4.8% inflation outlook.
Inflation is then predicted to ease to 4.2% in 2027, upgraded from the previous 4% forecast.
The OECD expects reduced purchasing power to weaken growth in India through the second half of this year, before recovering gradually in 2027.
It also expects a weaker monsoon to curb agricultural production and for the Reserve Bank of India to raise policy rates temporarily to help offset stronger inflationary pressures.