World Bank lowers India's FY26 growth forecast to 6.3%

 The World Bank has revised India’s GDP growth forecast for the fiscal year 2025–26 (FY26) down to 6.3%, a decrease from its earlier estimate of 6.7%. This downgrade reflects growing concerns about global economic headwinds and uncertainties in domestic policies. According to the World Bank, a weakening global economy is likely to impact India's export demand and private investments, while domestic challenges such as inconsistent policy implementation and slower-than-expected growth in public and private capital expenditure are also weighing on the outlook. Despite efforts by the government and central bank to stimulate the economy through reforms and monetary easing, these have not been enough to offset the broader challenges. In comparison, the International Monetary Fund (IMF) has forecasted a slightly lower growth rate of 6.2% for FY26, while the Reserve Bank of India (RBI) remains more optimistic at 6.5%. The World Bank has also revised growth estimates downward for other South Asian countries, citing limited resilience against global shocks. This suggests a broader regional trend of slowing economic momentum, reinforcing the need for India to focus on strengthening fiscal health and boosting investor confidence through clear, stable policies.

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