World Bank raises India’s growth for FY26

India’s economic growth forecast has been raised for FY26 to 6.5% from 6.3% earlier, while the projections for FY27 have been lowered by 0.2 percentage points to 6.3%, citing higher-than-anticipated tariffs by the US, said the World Bank in its latest South Asia Development Update, Jobs, AI, and Trade. However, India will remain the world’s fastest-growing major economy, supported 
by resilient consumption growth. The economy grew 6.5% in FY25 and hit a five-quarter high of 7.8% in the April-June period. The government’s reforms to the Goods and Services Tax (GST)—reducing the number of tax brackets and simplifying compliance—are expected to support activity, it said. India’s goods exports to the US account for around 2% of gross domestic product (GDP), as per a report.

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