Economic Growth Projections for India and Global Context
The Indian economy is forecasted to grow at 6.6 percent in 2026, a revision from the earlier estimation of 7.4% growth in 2025, according to a United Nations report. Global economic growth is projected to decline to 2.7 percent this year from 2.8 percent last year.
India's Economic Outlook
- The Indian government's annual GDP estimates project a growth of 7.4% for the current fiscal year.
- The Reserve Bank of India estimates GDP growth at 7.3%, compared to its 6.5% projection for 2025.
- Strong demand in major markets may offset the impact of US tariff hikes on India.
Global Economic Outlook
- Global trade is projected to slow to 2.2 percent this year from 3.8 percent in 2025.
- The United States is expected to grow at 2 percent this year, up from 1.9% in 2025.
- China's growth is projected at 4.6% this year and 4.5% for the next year.
- The global economy faces risks of slower growth, failing to deliver broad-based development gains.
Challenges and Risks
- Policy uncertainty, geopolitical risks, and fiscal challenges continue to cloud the global economic outlook.
- Increased US tariffs in 2025 unsettled the trade environment, yet the world economy showed unexpected resilience.
- Global growth is expected to moderate due to weaker international trade, partially offset by continued monetary easing in 2026.
- Inflation has eased, but rising living costs continue to strain household budgets and exacerbate inequality.
