-- The Asian Development Bank has projected India's economic growth, measured by the gross domestic product (GDP), at 6.9% for the financial year ending March 31, 2027, dragged by external pressures, the global agency said in its Asian Development Outlook report released on Friday.
The real GDP grew by 7.6% in the financial year ended March 2026.
The lender has also forecast GDP growth at 7.3% in the following fiscal year 2027-28, driven by strong domestic demand and easing financial conditions, as consumption and investment benefit from favorable policies and the external environment improves.
"Despite a worsening global economic and geopolitical environment, growth in India is forecast to remain robust at 6.9% in fiscal year 2026 (2026-27)," the report said, adding that domestic demand would drive economic activity.
The projection marks an upward revision from its earlier estimate of 6.5% for the financial year 2026-27 made in December 2025.
The report highlighted that the growth momentum will be supported by lower U.S. tariffs on Indian goods and sustained internal consumption, despite global uncertainties.
"On the supply side, manufacturing and services growth are expected to remain strong, aided by domestic reforms and by public spending on rural welfare programs, price support for key agriculture commodities, and resilient rural incomes," the ADB said.
Inflation is forecast to rise to 4.5% in the financial year 2026-27 amid conflict in the Middle East, before easing to 4.0% in the financial year 2027-28 as food prices moderate.