India’s economy grew by 7.8% in the April-June quarter of FY27, leading several major global institutions to raise their growth forecasts for the country. The strong numbers have also sparked a debate in India over the new GDP calculation method and how long the current growth momentum can continue.
According to the Ministry of Statistics and Programme Implementation, real GDP growth stood at 7.8% in the first quarter of FY27, compared with 6.9% during the same period a year earlier. Following the data release, S&P Global Ratings, Fitch Ratings, the Asian Development Bank and the OECD revised their growth forecasts for India. Moody’s had also raised its estimate earlier.
S&P now expects India to grow 7% in FY27, up from 6.6%. Fitch increased its forecast from 6.4% to 6.9%, while the ADB raised its estimate from 6.6% to 7%. The OECD made the biggest revision, increasing its forecast from 6.3% to 7.1%. Moody’s raised its estimate from 6% to 7%.
The agencies pointed to strong domestic demand, investment and industrial activity as key reasons behind their improved outlook. Gross fixed capital formation grew 11.9%, private consumption increased 7.1%, while manufacturing expanded 9.2% during the quarter.
However, questions remain in India over the new GDP series and its methodology. The government has defended the revised system, saying it uses more administrative and high-frequency data. Global institutions have also warned that growth could slow later in the financial year. Higher energy prices, food inflation, weather-related risks and geopolitical tensions could affect the economy.
Overall, the latest forecasts suggest stronger global confidence in India’s near-term growth, although sustaining this momentum will depend on domestic demand, investment and external economic conditions.
