India Growth Forecast Raised to 6.6% as World Bank Cites Strong Demand

According to the World Bank Group’s twice-a-year regional outlook report, India’s growth is estimated to have accelerated from 7.1 percent in the financial year 2025 to 7.6 percent in Financial Year 26, driven by strong domestic demand and export resilience.

The report stated that private consumption growth was particularly robust, supported by low inflation and rationalisation of the Goods and Services Tax.

The World Bank said that the reduction in GST rates is expected to continue supporting consumer demand in the first half of Financial Year 27. However, elevated global energy prices are expected to put upward pressure on prices and constrain households’ disposable income.

The growth outlook for South Asia is being driven primarily by India’s performance, according to the report, with the country’s expansion underpinned by robust domestic demand, tariff cuts, and recent trade agreements, including the free trade agreement with the UK and European Union.

World Bank Vice President for South Asia, Johannes Zutt, said that despite a challenging global environment, South Asia’s growth prospects remain strong.

With India’s economy continuing to lead regional growth, the World Bank’s revised forecast highlights the role of domestic demand, trade agreements, and export resilience in shaping the country’s economic outlook.