India's GDP growth expected to be 6.9% in 2026: Goldman Sachs
By yash chouhan 2026-02-12 16:52:16
Goldman Sachs estimates India's GDP growth at 6.9% in 2026
Goldman Sachs estimates India's real GDP will grow at 6.9% in 2026 and 6.8% in 2027, above market consensus. The economy is projected to grow by 7.7% in 2025, despite challenges such as US tariffs.
Inflation to remain at record-low level in 2025. Headline inflation averaged 2.2%, while it is expected to rise to 3.9% in 2026, close to the Reserve Bank of India's (RBI) target of 4%.
RBI cuts rates by 125 basis points in 2025 and increases liquidity in the banking system. The scope for further cuts is limited, but an additional 25 basis points cut could be considered if US tariff uncertainty persists.
In February, under the India-US trade agreement, tariffs on Indian goods were reduced from 25% to 18%. Goldman Sachs estimates that this could contribute an additional 0.2 percentage points annually to GDP growth and improve private investment.
Regulatory relief given to banks, weak exchange rate, and tax concessions should support urban consumption in 2025. ₹6.3 trillion has been injected into the banking system as part of the recent liquidity measures, which will further boost credit growth. Rural demand is also expected to remain strong in 2026.
The current account deficit stood at about 2.8% of GDP in the fourth quarter of 2025, but the full-year deficit is likely to be limited to 0.7%. This could rise to $37 billion in 2026, mainly due to growth in non-oil and non-gold imports.
