World Bank Raises India’s FY2025/26 Growth Forecast to 6.5%

The World Bank on Tuesday raised India’s economic growth forecast for FY 2025/26 to 6.5%, up from 6.3% in June.

However, the agency lowered its projection for FY 2026/27 by 0.2 percentage points to 6.3%, citing the impact of higher-than-anticipated tariffs imposed by the US.

“India is expected to remain the world’s fastest-growing major economy, underpinned by continued strength in consumption growth.

Domestic conditions, particularly agricultural output and rural wage growth, have been better than expected,” the agency said in South Asia Development Update (October 2025).

Last month, the Indian government stated that GDP growth in FY 2025–26 could exceed the projected 6.3%–6.8%, boosted by a surge in consumption following recent goods and services tax (GST) tariff cuts, along with strong Q1 GDP performance.

Recent data showed India’s GDP grew 7.8% in the June quarter, marking the fastest growth in five quarters.