New Delhi: India’s real GDP is projected to expand between 6.8 and 7.2 per cent in the financial year 2026-27, according to the Economic Survey, which outlines an outlook of steady domestic growth amid global uncertainties.
The survey notes that for India, “these global conditions translate into external uncertainties rather than immediate macroeconomic stress. Against the backdrop of global uncertainties, the domestic economy remains on a stable footing. Inflation has moderated to historically low levels, although some firming is expected to occur going forward.”
Household, corporate, and banking sector balance sheets are reported to be healthier, while public investment continues to support economic activity. Consumption demand remains resilient, and private investment intentions are improving, providing the economy with resilience against external shocks and supporting continued growth momentum. The survey also highlights that the forthcoming rebasing of the Consumer Price Index (CPI) series will have implications for inflation assessment, requiring careful interpretation of price dynamics.
However, the report points out potential challenges. Slower growth among key trading partners, tariff-related trade disruptions, and volatility in capital flows could intermittently affect exports and investor sentiment. At the same time, ongoing trade negotiations with the United States are expected to conclude during the year, which may help reduce uncertainty on the external front. While these risks are considered manageable, they underscore the importance of maintaining adequate buffers and policy credibility.
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The survey emphasises that the cumulative impact of India’s policy reforms over recent years appears to have lifted the economy’s medium-term growth potential closer to 7 per cent. With domestic drivers playing a dominant role and macroeconomic stability well anchored, the balance of risks around growth remains broadly even.
On the global front, the survey projects a subdued medium-term growth outlook, with downside risks dominating. Global growth is expected to remain modest, contributing to broadly stable commodity prices. Inflation across economies has trended downward, prompting expectations that monetary policies will remain accommodative and supportive of growth.
Nonetheless, certain risks persist. If the anticipated productivity gains from the AI boom fail to materialise, it could trigger corrections in overvalued assets, with potential for broader financial contagion. Prolonged trade conflicts could also weigh on investment and weaken global growth further. The survey concludes that while downside risks to global growth remain prominent, fragile stability holds for now.
With PTI inputs