India’s GDP growth may slow to 6.6 per cent in FY27: Crisil

India's GDP growth is expected to slow to 6.6 per cent in FY27 from 7.7 per cent in fiscal 2026, according to Crisil Ratings. Higher crude oil prices, below-normal monsoon rainfall, rising inflation and weaker global demand are expected to impact growth

New Delhi: India’s GDP growth is expected to moderate in FY 2027 at 6.6 per cent after a stronger‑than‑expected 7.7 per cent expansion in fiscal 2026, a report has said.

The report from Crisil Ratings said that a sharp rise in crude prices, a below‑normal monsoon and higher inflation will weigh on consumption and growth.

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“Growth outperformed expectations in fiscal 2026 due to fiscal support to private consumption, rate cuts by the Reserve Bank of India, healthy global growth, low inflation, favourable monsoon and low crude oil prices,” the report said.

In FY27, many of these factors are expected to turn adverse and weigh on growth, it added.

Crude oil prices have surged to decadal highs after the onset of the West Asia crisis and are expected to remain high this fiscal, averaging $90-95 per barrel, according to Crisil Intelligence.

The India Meteorological Department (IMD) has expected rainfall at 90 per cent of the long-period average in the 2026 southwest monsoon season, indicating below-normal rains.

The likelihood of El Niño conditions will add to the pressure on agricultural production.

The report forecasted inflation to rise sharply to 5.1 per cent in fiscal 2027 from 2.1 per cent in fiscal 2026, putting pressure on private consumption.

Producers are expected to pass on the sharp rise in the cost of energy and other inputs, as well as trade and transportation, to consumers, which will likely raise core inflation.

Global demand is expected to be weaker this year due to the West Asia conflict and this will likely impact India’s exports, the report said.

Notably, the growth momentum in India sustained despite headwinds from the West Asia conflict that began towards the end of February and intensified in March.

Private final consumption expenditure (PFCE) growth remained healthy at 7.1 per cent vs 8.2 per cent in the previous quarter. It was far higher than the 10-quarter average of 6.4 per cent.