Indian economy projected to grow 6.6% despite global challenges
What's the story
A United Nations report has projected that India's economy will grow by 6.6% in 2026, a downward revision from the earlier estimate of 7.4% for 2025. The report also predicts a decline in global economic growth to 2.7% in 2026, down from last year's estimate of 2.8%. The US is expected to see a slight increase in its growth rate to 2% this year, supported by monetary and fiscal easing, up from 1.9% in 2025.
Economic resilience
India's growth amid global challenges
The UN report highlights India's economic resilience despite a challenging global environment. It credits robust private consumption and public investment for this resilience, which have largely offset the impact of high US tariffs. The report also notes that while some product categories may be affected by these tariffs, key exports such as electronics and smartphones are likely to remain unaffected.
Growth factors
UN report emphasizes India's growth drivers
The UN report emphasizes that India's growth will be driven by resilient consumption and strong public investment. It also highlights recent tax reforms and monetary easing as additional near-term support. Ingo Pitterle, Senior Economist at UN DESA, said South Asia will remain the world's fastest-growing region with much of this growth coming from India where robust domestic demand is driving growth.
Economic upgrade
UN report on India's macroeconomic situation
The UN report notes an "exceptional combination of factors" that have contributed to stronger growth in India. These include strong consumer demand, public investment, and falling inflation. The report also highlights India's diversification of export markets to the EU and Middle East as a significant factor in its economic resilience.