Crisil India’s real gross domestic product (GDP) growth would be steady at 6.5% in fiscal 2026 despite uncertainties stemming from geopolitical turns and trade-related issues led by US tariff actions.

The forecast is based on two assumptions, Crisil said at its flagship India Outlook seminar today. These include another spell of normal monsoon and commodity prices continuing to remain soft. Cooling food inflation, the tax benefits announced in the Union Budget 2025-2026, and lower borrowing costs are expected to drive discretionary consumption.

Key Highlights:

1. Growth Projection:
   Crisil anticipates a GDP growth rate of 6.5% for India in fiscal year 2026, indicating resilience and steady momentum despite global uncertainties.

2. Growth Drivers:
   Several economic and policy factors are expected to support this projected growth, including:

• Expected 50 basis points cut in policy rates by the Reserve Bank of India, aimed at boosting credit flow and industrial activity.
• An above-normal monsoon, estimated at 106% of the long-period average, likely to improve agricultural productivity and rural consumption.
• Subdued crude oil prices, projected to remain between $65–$70 per barrel, which would help moderate inflation and support purchasing power.

       3. External Challenges:

Despite strong domestic indicators, risks from global trade disruptions, geopolitical tensions, and supply chain volatility remain potential threats to the growth outlook.

This projection underscores the strength of India’s domestic economy and the strategic impact of timely policy interventions in sustaining growth momentum.