RBI raises India’s real GDP growth to 7.6 pc for FY26, pegs FY27 at 6.9 pc

Reserve Bank of India projected 7.6% GDP growth for FY26 and 6.9% for FY27, with Sanjay Malhotra citing resilience from domestic demand but warning of geopolitical risks, inflation pressures, and global slowdown impacting India’s outlook

New Delhi: The Reserve Bank of India (RBI) on Wednesday estimated India’s real GDP growth at 7.6 per cent for FY26 under a new GDP series, while flagging emerging risks from geopolitical disruptions. The FY26 growth reflects resilience supported by strong services activity, manufacturing expansion and robust domestic demand.

For FY27, the Central Bank has projected growth at 6.9 per cent, indicating a moderation as external risks and cost pressures begin to build, said RBI Governor Sanjay Malhotra after the MPC meeting.

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The GDP growth for Q1 FY27 has been revised to 6.8 per cent from 6.9 percent, while Q2 FY27 growth has been lowered to 6.7 per cent from 7 per cent amid global headwinds due to Iran war. “Global growth faces increasing downside risks as the sharp rise in energy rises have stoked inflation fears,” said Malhotra.

The GDP growth stood at 7.8 per cent in the December quarter of FY26, from 8.4 per cent in the preceding quarter. The RBI expects the revival in private sector investment to sustain on back of high capacity utilisation. Also, food price outlook remains comfortable in near term, said the Governor.

Overall CPI inflation for FY27 is projected at 4.6 per cent. For Q1, it is estimated at 4 per cent; 4.4 per cent for Q2; 5.2 per cent for Q3; and 4.7 per cent for Q4. Malhotra further said that “we will ensure sufficient liquidity in the banking system to meet productive requirements of the Indian economy”.

As on April 3, India’s forex reserves stood at $697.1 billion. “Net FDI showed improvement on small base of last year. India remains attractive destination for greenfield FDI projects,” said the Governor. The RBI expects the revival in private sector investment to sustain on back of high capacity utilisation.