📊 S&P Upgrades India’s FY26 GDP Growth Estimate to 6.5%
In a boost to India’s economic sentiment, S&P Global Ratings has revised India’s GDP growth forecast for FY26 to 6.5%, citing robust domestic demand, improving private investment, and policy continuity following the 2024 general elections.
This upgraded outlook signals renewed confidence in India’s economic fundamentals and reflects the resilience of Asia’s third-largest economy despite global headwinds.
💡 What’s Behind the Upgrade?
Here are the key factors driving S&P’s decision to raise India’s FY26 growth projection:
✅ 1. Strong Domestic Demand
India’s burgeoning middle class and rising consumption trends continue to fuel domestic economic momentum.
✅ 2. Private Sector Investment
Capital expenditure by Indian companies is witnessing a strong revival, particularly in manufacturing and infrastructure.
✅ 3. Stable Political Environment
The continuity in governance post-2024 elections has created a stable business environment, supporting long-term economic planning.
✅ 4. Digital and Infrastructure Push
Government-backed initiatives in digital infrastructure, logistics, and energy transition are expected to enhance productivity and create multiplier effects.
📈 How Does This Compare?
The previous S&P forecast for FY26 GDP was around 6.2%. While the 6.5% estimate is still below India’s pre-pandemic highs, it reflects improved confidence in the country's ability to navigate inflation, global interest rate volatility, and geopolitical uncertainty.
❓ FAQs: India’s FY26 GDP Forecast by S&P
Q1. What is India’s FY26 GDP growth estimate according to S&P?
S&P Global Ratings has projected India’s GDP to grow at 6.5% in FY26, an upward revision from its previous estimate.
Q2. Why did S&P raise the growth estimate?
The upgrade was driven by stronger-than-expected domestic demand, improved investment climate, and political stability post-elections.
Q3. How does India’s projected growth compare globally?
India remains among the fastest-growing major economies globally, significantly outpacing growth forecasts for developed markets.
Q4. What sectors are expected to lead this growth?
Manufacturing, services, digital economy, and infrastructure are expected to be the key growth drivers.
Q5. Is this growth sustainable?
While challenges remain, such as inflation and global demand slowdowns, structural reforms and fiscal prudence are likely to support long-term sustainability.
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Reported by Benny on June 27, 2025.
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