Summary of this article
India to remain fastest-growing major economy through 2027
Growth supported by lower tariffs and strong 2025 momentum
Global growth to slow amid Middle East conflict risks
India’s economy is expected to grow a tad faster at 6.5 per cent in 2027 despite escalating tensions in West Asia, the International Monetary Fund (IMF) said on Tuesday.
The 6.5 per cent growth projection makes India the fastest-growing major economy in 2026.
“For 2026, growth is revised upward moderately by 0.3 percentage point (0.1 percentage point relative to January) to 6.5 per cent, led by positive contributions from the carryover of the strong 2025 outturn and the decline in additional US tariffs on Indian goods from 50 to 10 per cent, which outweigh the adverse impact of the Middle East conflict," IMF said in its World Economic Outlook released here.
"Growth is projected to stay at 6.5 per cent in 2027,” it said.
Under the assumption in the reference forecast that the war turns out to be relatively short-lived, global growth is expected to slow down modestly, the IMF said.
At 3.1 per cent for 2026 and 3.2 per cent for 2027, the forecasts mark a deceleration from the estimated 3.4 per cent achieved in 2025.
At market exchange rates, world output is projected to grow by 2.6 per cent in both 2026 and 2027, it said.
The relatively modest downward revision to global growth in the reference forecast relative to the January 2026 WEO Update owes to continued tailwinds partially offsetting the negative shocks from the conflict, including lower tariffs, pre-existing policy support, and carryover from stronger-than-expected outturns at the end of 2025 and the first quarter of 2026 in some cases.
