The Reserve Bank of India (RBI) has projected India’s real GDP growth at 6.5 per cent for the financial year 2025-26, with the outlook described as “evenly balanced” amid global uncertainties.
In its annual report for 2024-25, released on Thursday, the central bank said India is poised to remain the fastest-growing major economy, riding on strong macroeconomic fundamentals, a resilient financial sector, and a continued policy push towards sustainable and inclusive growth.
This outlook comes despite global headwinds, including financial market volatility, geopolitical tensions, trade fragmentation, supply chain disruptions, and climate-induced uncertainties — all of which pose downside risks to growth and upside risks to inflation.
“Amid multiple global headwinds, Indian financial markets exhibited resilience and orderly movements. The central government maintained its fiscal consolidation efforts, supported by buoyant tax revenues and prudent expenditure management. On the external front, the merchandise trade deficit was offset by robust services exports and steady remittance inflows, keeping the current account deficit at a sustainable level,” the RBI noted.
“The outlook for the Indian economy remains promising,” the RBI said, citing factors such as a revival in consumption demand, the government’s ongoing focus on capital expenditure alongside fiscal consolidation, healthier balance sheets of corporates and banks, and resilience in the services sector.
The central bank said the agriculture sector could perform well in FY26, buoyed by the forecast of an above-normal southwest monsoon and productivity-oriented policy interventions announced in the Union Budget 2025-26.
The manufacturing sector is also expected to gain traction, driven by rising domestic demand, higher capacity utilisation and supportive government policies, including the Production-Linked Incentive (PLI) scheme and the National Manufacturing Mission, which are aimed at reinforcing the ‘Make in India’ initiative.
“Improving business and consumer sentiment, as reflected in RBI’s forward-looking surveys, underlines optimism in both manufacturing and services sectors,” the report said.
IANS