April 10, New Delhi: The World Bank has raised India's growth forecast from 6.3% to 6.6% for the current fiscal year, citing strong domestic demand and free trade agreements. In its latest report, the World Bank expects India to remain the primary engine of growth in South Asia.
The report also noted that, although the reduction in GST rates should continue to support consumer demand in the first half of FY27, elevated global energy prices are expected to put upward pressure on prices and constrain household disposable income.
The World Bank Group, in its twice-yearly regional outlook report, stated that the growth outlook is primarily driven by India's performance, underpinned by robust domestic demand as well as tariff cuts and recent trade agreements.
In India, growth is estimated to have accelerated from 7.1 percent in fiscal year 2025 to 7.6 percent in Fiscal Year 26, owing to strong domestic demand and export resilience. Private consumption growth was particularly robust, supported by low inflation and the rationalization of the Goods and Services Tax.
World Bank Vice President for South Asia, Johannes Zutt, said that despite a challenging global environment, South Asia's growth prospects remain strong.
