The Ministry of Finance on Thursday upgraded the growth forecast for the ongoing financial year 2026-27 to 7.3% from 6.8-7.2% estimated earlier in the Economic Survey in February this year.
In its Monthly Economic Review for October, the Ministry also marginally revised up the growth projection for July-September to 7.5% from 7.3% in its September report. The economy had grown by 7.8% in April-June, the first quarter of this financial year.
Underlining "considerable uncertainties", the Ministry said that robust domestic demand, sustained investment activity, a resilient financial sector, and supply-side management have underpinned the country's growth resilience so far and are expected to support growth through remainder of year. "Sustaining economic activity while safeguarding price stability" will be focus of policymakers in second half of financial year amidst elevated crude oil prices, higher food inflation and uncertain outlook for kharif crop.
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Recently, IMF increased growth forecast to 7% for 2026-27, up from 6.4% in July. RBI also raised GDP growth projection to 7.1%. High-frequency indicators spanning industrial output, energy consumption, port traffic, GST collections, and auto mobile sales recorded stronger growth in Q2 FY27 than in previous quarter. Building on growth of 7.8% in Q1, Department's nowcasting model estimates real GDP growth at 7.35% in Q2 FY27.
Meanwhile, Commerce Minister Piyush Goyal said India's sensitive sectors have been protected and it will have a strong comparative advantage under the trade deal with the US. Speaking at Institute for Studies in Industrial Development (ISID) conference, Goyal said “people of India will celebrate once details become public.”
Rejecting criticism, Goyal said US free trade deal is sometimes sought to be politicised by a few elements. “But I have the courage of conviction to announce boldly that the US trade deal, once details are out, the people of India will celebrate that not a single sensitive interest of our farmers has been compromised.”
Goyal said India has already banned imports of goods using forced labour following first Section 301 investigation, and US paused tariffs o on purchase of Russian oil. The oil-related tariffs were the sore point between India and US, as both countries have found convergence on other tariffs. Both the US Section 301 investigation and trade deal have resulted in convergence between countries.
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Diesel exports context: India's diesel exports hit 13-month high at 0.71 million barrels per day in Oct 1-29, up 19.6% over September, as global diesel crunch due to West Asia and Russia-Ukraine conflicts boosted demand. Reliance alone shipped 0.55 mbpd.
For India, 7.3% with crude at $90 is credible but needs private capex to sustain.
Tags: #GDP #FY27 #GrowthForecast #FinanceMinistry #CrudeOil #PiyushGoyal #USIndiaTrade #Section301 #DieselExports #