Bank of America (BofA) has revised India’s GDP growth projection for the current fiscal year (FY26) to 7.6%, up from the previous estimate of 7%. Additionally, BofA has upgraded its GDP estimate for fiscal year 2027 to 6.8%, compared to the earlier forecast of 6.5% for FY27.
The global brokerage firm mentioned that recent data supports the need for a GDP forecast upgrade for India, pointing to widespread improvements in the nation’s economic activity by the end of 2025. India’s economic growth prospects have brightened following a better-than-expected 8.2% growth in the second quarter, leading to upward revisions in growth projections for 2025-26.
Policy support is anticipated to be a key driver of growth enhancement in the coming period, according to the BofA note. The Reserve Bank of India (RBI) has raised its GDP growth forecast to 7.3%, reflecting a favorable monetary environment with multiple rate cuts in 2025 under Governor Sanjay Malhotra.
The brokerage firm highlighted that increased consumption and spending, coupled with stronger investment data, have been observed. Notably, high-frequency indicators like fuel consumption, auto sales, and credit growth exhibited acceleration in November and December, reinforcing the decision to raise short-term forecasts.
The government is preparing to unveil a new GDP series and inflation series, including back-series data for 2022-23, 2023-24, and 2024-25 for continuity and comparison. Despite this, significant changes in India’s GDP growth estimates are not expected post the release of the revised national accounts series in February next year.
