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International Monetary Fund has projected India's GDP growth at 6.5% for both 2026 and 2027, maintaining its position as the fastest-growing major economy despite geopolitical tensions in West Asia. The estimate, published in its latest World Economic Outlook, reflects an upward revision driven by strong economic momentum from 2025 and a reduction in additional US tariffs on Indian goods. These factors are expected to offset the adverse impact of the ongoing conflict in the Middle East. Meanwhile, global growth is projected to moderate to 3.1% in 2026 and 3.2% in 2027, compared to 3.4% in 2025. The outlook indicates a stable growth trajectory for India within a gradually slowing global economy.
International Monetary Fund (IMF) has projected India's gross domestic product (GDP) to grow at 6.5% in both 2026 and 2027, according to its latest World Economic Outlook released in the past week, positioning the country as the fastest-growing major economy despite ongoing geopolitical tensions in West Asia. Advertisement
The IMF stated that the growth estimate for 2026 has been revised upward by 0.3 percentage points compared to earlier projections, supported by strong economic carryover from 2025 and favourable trade developments. It indicated that the reduction in additional US tariffs on Indian goods from 50% to 10% has contributed positively to the outlook, offsetting the adverse effects of the ongoing Middle East conflict.
The institution projected that India's growth will remain stable at 6.5% in 2027, reflecting continued resilience in economic activity. The forecast assumes that the geopolitical conflict remains relatively short-lived, limiting its long-term impact on global and regional growth trends.
Globally, the IMF expects economic growth to moderate over the next two years. It projected global GDP growth at 3.1% in 2026 and 3.2% in 2027, marking a slowdown from the estimated 3.4% growth recorded in 2025. At market exchange rates, global output is expected to expand at 2.6% annually during both years, indicating subdued momentum across major economies.
The IMF attributed the relatively modest downward revision in global growth forecasts to a combination of offsetting factors. These include lower tariff pressures, existing policy support measures, and stronger-than-expected economic performance observed in late 2025 and early 2026 in certain regions. These elements have helped cushion the negative impact arising from geopolitical uncertainty.
The report highlighted that while risks linked to global conflicts remain, macroeconomic conditions in key economies continue to be supported by policy interventions and residual growth momentum. For India, the combination of domestic demand strength and improved external conditions has contributed to a steady outlook.
The IMF's assessment forms part of its periodic evaluation of global economic trends and provides a reference for policymakers and financial markets. The projections underline India's continued role as a key contributor to global growth, even as the broader economic environment faces moderation due to external uncertainties.
Source - PTI
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