Business EconomyPosted at: Sep 18 2026 12:18PM


Moody's raises India GDP growth forecast to 7pc for current fiscal

New Delhi, Sep 18 (UNI) Global ratings agency Moody's Ratings has raised its forecast for India's real gross domestic product (GDP) growth in the current fiscal year to 7pc from 6pc, citing the resilience of the Indian economy despite the ongoing West Asia conflict.
Moody's said India is expected to continue expanding faster than other G20 economies as well as emerging-market sovereigns with similar credit ratings.
However, the agency cautioned that risks to the outlook remain, particularly from developments in energy and food prices.
The ratings agency flagged elevated global energy prices as a key risk to India's economic outlook.
A prolonged rise in energy costs could put pressure on inflation and household consumption while also weighing on overall economic growth.
Moody's also highlighted the potential impact of an El Niño weather pattern, which could push up food prices and create additional inflationary pressures.
Higher food and energy costs could, in turn, affect consumer spending and economic activity.
On the fiscal front, Moody's said the government's response to the economic impact of the West Asia conflict has so far been relatively limited.
However, a sustained increase in global energy prices could change the fiscal picture by increasing the need for subsidies or other forms of government support.
At the same time, higher spending on defence and infrastructure could make fiscal consolidation more challenging, the agency said.
The upgraded outlook comes after India's economy delivered stronger-than-expected growth in the April-June quarter. Real GDP expanded 7.8pc year-on-year (Y-o-Y), according to government data released last month.
The June-quarter performance was supported by a strong increase in investment and manufacturing activity, which helped offset weaker growth in mining and consumer-facing services.
Moody's latest projection therefore reflects a combination of stronger domestic economic momentum and India's ability to absorb external shocks.
At the same time, the agency's warnings around crude oil, food inflation and government spending highlight the key factors that could influence India's growth trajectory in the months ahead. UNI VK SAS
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