S&P Forecasts 6.5% GDP Growth For India In FY2025-26

S&P Global Ratings has said that India’s economy will continue to grow strongly in the coming years. According to their forecast, India’s GDP will grow 6.5% in FY2025-26 and 6.7% in FY2026-27. This growth will mainly come from higher consumer spending, expected tax cuts, and easier monetary policies such as possible interest rate reductions.

India is already one of the world’s fastest-growing major economies, and this outlook shows confidence in the country’s economic policies.

Growth Led by Consumption

S&P believes that India’s growth will be driven mainly by domestic consumption.

Expected tax cuts will give people more money to spend.
Lower interest rates may encourage people and businesses to borrow more, increasing investment in retail, services, and real estate.

India’s GDP grew 7.8% in the April–June quarter of 2025, the highest in over a year. Although this pace may slow down slightly, growth is still expected to remain strong.

Role of International Policies

S&P also mentioned that a possible India–US trade agreement could boost investor confidence and help industries such as textiles and electronics.
However, high US tariffs on some Indian goods may continue to limit export growth. Even then, India’s strong domestic market is expected to protect the economy from major risks.

Comparison with RBI’s Forecast

The Reserve Bank of India (RBI) expects India’s economy to grow 6.8%, which is slightly higher than S&P’s forecast.
Both agencies agree that India will grow steadily despite global challenges like inflation, geopolitical tensions, and slow world trade.