Indian Economy News

India’s economy is projected to grow by 6.6% in FY27: SBI Research Report

India’s economy is projected to grow by 6.6% in the FY27, according to an SBI Research report released in May 2026. The report noted that the Indian economy continues to demonstrate resilience despite global uncertainties and regional geopolitical conflicts. GDP growth for 2025-26 is estimated at 7.5%, while real GDP growth in the fourth quarter of FY26 is expected to remain close to 7.2%. The report highlighted that strong domestic consumption, improving rural demand and sustained credit growth are expected to support economic momentum in the coming fiscal year. High-frequency indicators also suggest that economic activity has remained robust, despite a slight moderation during the fourth quarter.

The report further stated that bank credit growth by scheduled commercial banks accelerated to 16.1% in FY26, compared to 11% in the previous year. Total incremental credit growth stood at Rs. 29.5 lakh crore (US$ 336.5 billion), with the second half of FY26 witnessing significantly stronger momentum than the first half. Rural consumption remained healthy due to positive farm and non-farm activity, while urban consumption received support from fiscal measures and festive demand. However, SBI Research noted that volatility in crude oil and commodity prices, along with the possibility of El Niño conditions, could create inflationary pressures in the near term. The report also emphasised the need for structural reforms to strengthen export competitiveness, promote import substitution, and enhance India’s integration into global value chains.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.