IMF Raises India’s FY26 Growth Forecast To 6.6%, Calls It A Fastest-Growing Economy

International Monetary Fund (IMF) has revised the projected growth trajectory of India to 6.6 per cent in its World Economic Outlook (WEO) report for FY2025-26, terming the country as one of the fastest-growing

’emerging and developing economies’.

India’s economic resilience, manufacturing revival and domestic consumption have been attributed for this upward resilience.

The IMF attributed the upward revision mainly to the strong momentum carried into FY26, noting that recent tariff actions had little to no impact on the outlook.

However, IMF has cautioned that it will hard for India to sustain the first-quarter growth with the fading of momentum and has trimmed India’s 2026-27 growth forecast to 6.2 per cent.

India’s economy expanded by 6.5% in FY25 and is expected to remain within the government’s projected growth range of 6.3–6.8% for FY26, even as global uncertainties persist. With this, India is on track to surpass China’s estimated growth of 4.8%.

The latest IMF projections come after evaluating the ripple effects of US tariffs and the trade negotiations that followed across major economies. Since the tariff impact turned out to be milder than anticipated, the global economy is now expected to grow by 3.2% in 2025, before moderating slightly to 3.1% in 2026. Despite the upgrade, these growth estimates still fall short of pre-policy-shift expectations.

US President Donald Trump-led administration has imposed an additional 50 per cent tariffs on Indian imports from September. This includes a second 25 per cent duty added to the earlier 25 per cent hike notified earlier in September.

The move was the culmination of US President Donald Trump’s ongoing tariff campaign targeting countries that maintain economic ties with Russia, with India being a key buyer of Russian crude. The hike has drawn strong condemnation from New Delhi, while Moscow has backed India’s right to choose its own trade partners.

(With ANI Inputs)