RBI GDP Growth 2025: Central bank raises FY26 growth forecast to 7.3%

Economic Growth Projections - The Reserve Bank of India raised its GDP growth estimate for Q3 FY26 to 7.0% from 6.4% and for Q4 FY26 to 6.5% from 6.2% [1][15] - Projections for Q1 FY27 were increased to 6.7% from 6.4%, and for Q2 FY27, growth is projected at 6.8% [1][15] Recent Economic Performance - India's economy recorded a six-quarter high growth of 8.2% in the July-September period, driven by increased consumer demand following a reduction in goods and services tax (GST) [2][15] - The GDP growth in the preceding quarter was 7.8%, and 5.6% in the same quarter of the previous fiscal year, indicating a statistical boost from a low base [4][15] Factors Influencing Growth - Strong agricultural performance and easing inflation are contributing to rural consumption growth, which is expected to continue into the first half of FY27 [8][15] - The recent GST reforms, which introduced a two-slab structure of 5% and 18%, have lowered taxes on various household goods, further supporting consumption [10][15] Trade Relations and Future Outlook - Ongoing negotiations for a US-India trade deal could potentially lift growth to around 8% [9][10][15] - India's Chief Economic Advisor highlighted the economy's relative stability and growth potential amid global uncertainties [11][15] Long-term Economic Position - India is projected to become the world's fourth-largest economy by the end of FY 2025-26, having moved from the tenth to the fourth largest economy in just 11 years [12][16] - This growth trajectory is attributed to sustained economic growth and strategic reforms implemented by the government [13][16]