Ernst & Young has projected that India gross domestic product growth could range between 6.8 percent and 7.2 percent in the financial year 2026 to 27, highlighting resilience despite a challenging global economic environment. The outlook was shared by D K Srivastava, Chief Policy Advisor at EY India, who pointed to structural reforms and expanding trade relationships as key growth drivers.
According to EY assessment, India medium term prospects have strengthened due to its increasing number of bilateral trade agreements with major economies and economic groups. These agreements are expected to enhance market access, boost exports and encourage foreign investment inflows. Srivastava noted that in the context of global economic turbulence, diversified trade partnerships can provide stability and reduce dependence on any single market.
The global economic landscape continues to face headwinds, including geopolitical tensions, supply chain adjustments and fluctuating commodity prices. Despite these factors, India domestic demand, public capital expenditure and private sector investment are seen as supportive elements for sustained growth. EY analysis suggests that a combination of fiscal prudence and targeted policy interventions could help maintain macroeconomic stability.
Infrastructure spending has been a central component of India economic strategy. Continued investment in transport, logistics, digital connectivity and manufacturing capacity is expected to generate multiplier effects across sectors. Additionally, reforms aimed at improving ease of doing business and attracting global supply chains may further strengthen industrial output.
EY also emphasised the importance of maintaining inflation control and financial sector stability. A balanced monetary policy approach, along with prudent fiscal management, is considered crucial to sustaining growth momentum. Strong banking sector fundamentals and improved credit availability can facilitate expansion in key industries such as manufacturing, services and technology.
Export diversification plays a significant role in the projected growth range. By deepening economic ties with multiple regions, India may mitigate risks arising from slowdowns in specific markets. Trade agreements can also enhance competitiveness by reducing tariffs and promoting regulatory cooperation.
While the growth forecast remains positive, EY indicated that external risks persist. Global economic slowdowns, energy price volatility and financial market fluctuations could influence outcomes. However, India structural reforms and demographic advantages are expected to provide resilience.
The projected 6.8 to 7.2 percent growth rate positions India among the faster growing major economies if achieved. Policymakers are likely to focus on sustaining investment cycles, strengthening export competitiveness and ensuring inclusive development.
Overall, EY outlook underscores cautious optimism. By leveraging trade partnerships, maintaining policy discipline and encouraging private investment, India could navigate global turbulence and sustain steady economic expansion in the financial year 2026 to 27.
