India’s Economic Growth Outlook Improves as GDP Forecast Rises to 6.7%

India’s economy is expected to grow slightly faster this fiscal year, with economists in a recent Reuters poll raising their forecasts for the second consecutive month. The revision follows a stronger-than-expected 7.8% GDP expansion in the April–June quarter, signaling sustained economic resilience.

According to the October 15–24 Reuters survey of over 40 economists, India’s gross domestic product (GDP) is now projected to grow 6.7% this fiscal year—up from 6.6% in September and 6.3% in August. The boost is driven by robust consumer demand and the government’s decision to cut Goods and Services Tax (GST) rates ahead of the festive season.

Despite lingering pressure from a 50% U.S. tariff on Indian exports, optimism has grown following recent talks between Washington and New Delhi that may ease trade tensions. Economists noted that if tariffs are reduced, growth in the second half of the fiscal year could exceed expectations.

The Reserve Bank of India (RBI) is also expected to support growth through monetary easing. Around 68% of economists predict a 25 basis point rate cut in December, after the RBI kept the repo rate steady at 5.50% in October. With inflation averaging 2.5% this year and expected to rise to 4.2% next year, policymakers appear to have room to stimulate growth.

However, challenges remain. Private investment continues to lag due to global uncertainty and policy shifts, especially from the U.S., which have dampened investor confidence. Analysts believe investment activity will rebound once external pressures subside.

Economists forecast India’s GDP to expand by 6.5% in each of the next two fiscal years, maintaining its status as the world’s fastest-growing major economy.