The International Monetary Fund (IMF) has increased its forecast for India’s economic growth to 7% for 2026-27, compared with its earlier projection of 6.4% released in July. The upward revision reflects stronger-than-expected economic activity, supported by resilient domestic demand and robust growth in the services sector.
The latest estimate comes shortly after the Reserve Bank of India (RBI) raised its GDP growth projection to 7.1% for the current financial year. In its updated World Economic Outlook report, the IMF highlighted India’s favourable demographic trends, expanding domestic market and ongoing structural reforms as important factors supporting its growth outlook.
The Fund also noted that India’s economy has maintained strong momentum despite rising international oil prices and continuing geopolitical uncertainty.
India GDP Growth Forecast for 2027-28
The IMF has also revised its growth projection for India for 2027-28 to 7%, up from the earlier estimate of 6.7%.
These projections come amid geopolitical tensions, including the US-Iran conflict and the Russia-Ukraine war, both of which pose potential challenges for countries that depend heavily on energy imports.
According to the IMF’s estimates, the average price of crude oil, based on Brent, Dubai Fateh and West Texas Intermediate (WTI) benchmarks, is expected to reach $95.74 per barrel in 2026. This would represent an increase of 41% compared with 2025.
The Fund expects average crude oil prices to decline by approximately 9% in 2027, bringing them to around $87.39 per barrel.
Meanwhile, India’s current account deficit is projected to widen to 1.5% of GDP in FY27, compared with 0.7% in FY26. The deficit is then expected to narrow to 1.3% of GDP in FY28.
IMF Economic Growth Projections for China and the US
The IMF expects China’s economic growth to slow over the next two years. Its economy is projected to expand by 4.5% in 2026 and 4% in 2027, compared with 5% growth in 2025.
The Fund has linked the slower outlook to higher global oil prices, prolonged uncertainty and structural challenges affecting economic activity.
In contrast, the US economy is forecast to grow by 2.3% in both 2026 and 2027.
Global Economic Growth Outlook
According to the IMF’s projections, the global economy is expected to grow by 3.1% in 2026 before accelerating to 3.4% in 2027.
Emerging and developing economies in Asia are projected to record growth of 5.1% in 2026.
India’s revised outlook reflects continued strength in domestic demand and services, even as international energy prices and geopolitical developments remain important risks for the global economy.
Disclaimer: This article is intended for informational purposes only and is based on the economic forecasts and figures provided in the source material. GDP projections are estimates and may change as economic conditions, international oil prices and geopolitical developments evolve. The information should not be treated as financial or investment advice.