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India’s GDP forecast cut as oil price shock weighs on growth
A Reuters poll projects India’s fiscal 2026/27 growth at 6.6%, down from 7.7% a year earlier, citing weaker private investment tied to higher crude prices.
Economists surveyed by Reuters are cutting their outlook for India’s economic growth, pointing to the impact of higher oil prices alongside slowing private investment. The poll expects growth of 6.6% in the fiscal year ending March 2027, a full percentage point lower than 7.7% in the prior fiscal year, with nearly three dozen economists surveyed between July 21 and 27.
The survey links recent oil price strength to weaker real economic activity than headline data has suggested since the Middle East crisis began. The report notes India’s growth has relied more on government spending as private investment has stayed weak amid the crude price shock and uncertainty about its broader effects on current accounts and public finances.
Morgan Stanley’s Upasana Chachra, chief India economist, told Reuters that even with policy support, companies may delay large capital expenditure if demand visibility worsens. The article also points to risks from a potential re escalation of the Middle East war and El Niño, with an IMF senior official saying higher oil prices could lower growth further in 2026/2027.
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