IMF Upgrades India Growth to 6.5 per Cent
From 2.1 per cent in FY26, CPI-based inflation will move up to 4.7 per cent in FY27 and temper down to 4 per cent the next year.
Chennai: The International Monetary Fund (IMF) has slightly upgraded India’s GDP growth forecast for FY27 to 6.5 per cent, by 0.1 percentage point from its January projection and 0.3 per cent from October projection. However, escalating geopolitical tensions -- particularly the war in the Middle East -- will weigh on global momentum and push inflation higher to 4.7 per cent in FY27.
“For FY27, growth is revised upward moderately by 0.3 percentage point (0.1 percentage point relative to January) to 6.5 percent, led by positive contributions from the carryover of the strong FY26 outturn and the decline in additional US tariffs on Indian goods from 50 to 10 percent, which outweigh the adverse impact of the Middle East conflict. Growth is projected to stay at 6.5 percent in FY28,” IMF said in its April forecast.
Growth for FY26 is revised upward by 1.0 percentage point relative to October, to 7.6 percent, reflecting the better-than-expected outturn in the second and third quarters of the fiscal year and sustained strong momentum in the fourth quarter.
Inflation in India is expected to return to near target levels after subdued food prices drove a marked decline in FY26. From 2.1 per cent in FY26, CPI-based inflation will move up to 4.7 per cent in FY27 and temper down to 4 per cent the next year.
Global growth is projected to be 3.1 percent in calendar year 2026 and 3.2 percent in 2027, slower than its recent pace of about 3.4 percent in 2024–25, and to settle at about that rate in the medium term, slower than its historical average of 3.7 percent.
The forecast for 2026 is revised downward by 0.2 percentage point and that for 2027 is unchanged, compared with those in the January 2026 update. Global headline inflation is expected to increase to 4.4 percent in 2026 and decline to 3.7 percent in 2027, marking upward revisions for both years.
The downward revision for 2026 largely reflects the disruptions from the conflict in the Middle East, partly offset by carryover from recent strong data and reduced tariff rates.
The downward revision to growth in emerging market and developing economies is 0.3 percentage point for 2026, relative to that in the January update, while the forecast is broadly unchanged for advanced economies.
