World Bank lifts India FY27 GDP growth forecast to 7.1%
Why in the news
The World Bank released its India Development Update on 6 October 2026, raising India’s FY27 GDP growth projection to 7.1% from the 6.6% it had estimated in April.
Key facts
- Trigger for upgrade: stronger-than-expected 7.8% growth in Q1 (April-June) of FY27.
- Main driver: private consumption; exports beat expectations and public investment added support.
- Supply side: industry, construction and electricity generation did well; services growth moderated but stayed high.
- Drags: monsoon rainfall deficit up to August, weaker farm outlook and possible softness in rural demand; subdued government consumption.
- Risks: the duration and intensity of the West Asia conflict, global trade tensions, monsoon variability and the pace of global growth.
- Fiscal deficit: general government deficit seen stable at 7.4% of GDP in FY27.
Projections
| Indicator | FY27 | FY28 | FY29 |
|---|---|---|---|
| GDP growth | 7.1% (earlier 6.6%) | 7.2%* | 7.0% |
| CPI inflation (average) | 4.8% | 4.4% | – |
*Assumes energy supply chains normalise by early 2027.
About the India Development Update
It is the World Bank’s periodic report on India’s economy, reviewing recent growth, prices, fiscal position and the outlook along with key risks.
Exam angle
- Note the figure pairs: 7.1% (FY27), 7.2% (FY28), 7.0% (FY29).
- Remember the earlier April estimate of 6.6% and Q1 FY27 growth of 7.8%.
- Inflation path 4.8% to 4.4% is useful for RBI policy questions.