India's FY26 growth prediction is raised by Standard & Poor's (S&P) to 6.5% due to strong domestic demand.

India's GDP growth prediction for FY26 has been raised by 0.2% to 6.5% by Standard & Poor's (S&P) Global Ratings, which bases this revision on the probability of a decent monsoon, declining crude oil prices, income-tax breaks, and anticipated monetary policy easing. India's economic momentum would be mostly driven by robust domestic demand, despite global headwinds including trade protectionism and geopolitical threats, according to S&P's Economic Outlook Asia-Pacific Q3 report, which was published on June 25, 2025. Further interest rate reduction by central banks throughout the Asia-Pacific region are made possible by the report's observation that inflation poses no serious threat to the region.

Global concerns could negatively impact India's export performance, but S&P said domestic spending will buffer GDP growth. Due to growing global trade uncertainties and possible spillovers from US protectionist actions, the agency had previously lowered India's FY26 GDP prediction to 6.3% in May 2025. The most recent update, however, shows a more positive domestic outlook. S&P reaffirmed that India is expected to become the third-largest economy in the world by FY30–35 and continues to benefit greatly from global supply chain realignments. The World Bank and the International Monetary Fund (IMF) have maintained their estimates of India's FY26 GDP at 6.3% and 6.2%, respectively, citing trade and geopolitical uncertainties, such as the ongoing Middle East conflict, which could put pressure on global oil prices. Other global forecasts are still more cautious.