Standard & Poor's (S&P) has raised its growth projection for India in FY26 to 6.5%, citing strong domestic demand.

Standard & Poor's (S&P) Global Ratings has updated its forecast for India’s gross domestic product (GDP) growth in FY26, increasing it by 0.2% to 6.5%, based on expectations of regular monsoon conditions, declining crude oil prices, income tax reductions, and anticipated easing of monetary policy. In the Economic Outlook Asia-Pacific Q3 report released on June 25, 2025, S&P pointed out that India's economic progress will primarily be fueled by strong domestic demand, despite facing global challenges like trade protectionism and geopolitical tensions. The report mentioned that inflation is not a major concern in the Asia-Pacific region, allowing central banks in the area to implement further interest rate reductions. Although India's export performance may be hindered by global uncertainties, S&P suggested that internal consumption will help support GDP growth. Previously, the agency had lowered its India FY26 growth forecast to 6.3% in May 2025 due to increasing risks from global trade and potential repercussions from US protectionist measures. Nevertheless, the most recent update indicates a more positive outlook domestically. S&P emphasized that India is poised to benefit significantly from global supply chain adjustments and is on course to become the third-largest economy in the world by FY30-35. Other global predictions are more cautious, as the World Bank keeps its India forecast at 6.3%, while the International Monetary Fund (IMF) has it at 6.2%, both citing uncertainties related to trade and geopolitical situations, including the ongoing conflict in the Middle East, which could impact global oil prices.