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The International Monetary Fund (IMF) on Monday raised India’s FY26 growth estimate to 7.3%, from 6.6% projected earlier, citing a better-than expected performance in the third quarter and strong momentum in the fourth quarter.
Based on IMF projections in its latest World Economic Outlook, India is expected to remain the fastest-growing economy among both advanced economies and emerging markets and developing economies in FY26 and FY27.
Last week, IMF spokesperson Julie KozackIndia said that India has been a key driver of global growth, noting that economic expansion in the country has been robust.
The World Bank also revised India’s FY26 growth outlook upward last week to 7.2% from 6.3% earlier, while projecting growth of 6.5% for FY27.
The IMF revised its FY27 growth forecast for India up by 0.2 percentage points to 6.4%, while keeping the FY28 projection unchanged at 6.4%. “Growth is projected to moderate (in FY27 and FY28) ….as cyclical and temporary factors wane,” said the IMF.
Earlier this month, the National Statistical Office (NSO) projected FY26 gross domestic product (GDP) growth at 7.4%, marginally higher than the IMF’s estimate.
On a calendar year basis, the Indian economy is projected to grow 6.3% in 2026 and 6.5% in 2027.
Globally, economic growth is expected to expand 3.3% in 2026 before easing marginally to 3.2% in 2027. “While tariffs and uncertainty are projected to continue to weigh on the level of activity, the effect on growth is expected to fade during 2026 and 2027,” said the IMF.
GDP growth of the United States is estimated to rise to 2.4% in 2026 from 2.1% in 2025, supported by fiscal measures and lower policy interest rates, before moderating to 2% in 2027.
China’s growth forecast for 2026 is revised upwards by 0.3 percentage points to 4.5%, reflecting lower US effective tariff rates on Chinese goods because of the year-long trade truce agreed in November, as well as stimulus measures assumed to be implemented over two years.
Global inflation is expected to continue easing, declining to 3.8% in 2026 and 3.4% in 2027.
“Inflation in India is expected to go back to near target levels after a marked decline in 2025 driven by subdued food prices,” the IMF noted.
World trade volume growth is expected to slow to 2.6% in 2026 from 4.1% in 2025, before rising to 3.1% in 2027. “These dynamics reflect patterns of front-loading and trade flow adjustments to new policies,” said the IMF.
Based on IMF projections in its latest World Economic Outlook, India is expected to remain the fastest-growing economy among both advanced economies and emerging markets and developing economies in FY26 and FY27.
Last week, IMF spokesperson Julie KozackIndia said that India has been a key driver of global growth, noting that economic expansion in the country has been robust.
The IMF revised its FY27 growth forecast for India up by 0.2 percentage points to 6.4%, while keeping the FY28 projection unchanged at 6.4%. “Growth is projected to moderate (in FY27 and FY28) ….as cyclical and temporary factors wane,” said the IMF.
Earlier this month, the National Statistical Office (NSO) projected FY26 gross domestic product (GDP) growth at 7.4%, marginally higher than the IMF’s estimate.
On a calendar year basis, the Indian economy is projected to grow 6.3% in 2026 and 6.5% in 2027.
Globally, economic growth is expected to expand 3.3% in 2026 before easing marginally to 3.2% in 2027. “While tariffs and uncertainty are projected to continue to weigh on the level of activity, the effect on growth is expected to fade during 2026 and 2027,” said the IMF.
GDP growth of the United States is estimated to rise to 2.4% in 2026 from 2.1% in 2025, supported by fiscal measures and lower policy interest rates, before moderating to 2% in 2027.
China’s growth forecast for 2026 is revised upwards by 0.3 percentage points to 4.5%, reflecting lower US effective tariff rates on Chinese goods because of the year-long trade truce agreed in November, as well as stimulus measures assumed to be implemented over two years.
Global inflation is expected to continue easing, declining to 3.8% in 2026 and 3.4% in 2027.
“Inflation in India is expected to go back to near target levels after a marked decline in 2025 driven by subdued food prices,” the IMF noted.
World trade volume growth is expected to slow to 2.6% in 2026 from 4.1% in 2025, before rising to 3.1% in 2027. “These dynamics reflect patterns of front-loading and trade flow adjustments to new policies,” said the IMF.
( Originally published on Jan 19, 2026 )
