Earlier projections had indicated a growth rate of around 7 to 7.4 percent for the current fiscal period.

India’s macroeconomic outlook remains supported by domestic strengths, but emerging global uncertainties could test its resilience, according to the latest monthly review released by the Ministry of Finance. The assessment highlights that disruptions linked to ongoing tensions in West Asia may affect the availability and pricing of key inputs such as crude oil and fertilizers, creating upside risks for inflation and external balances.

Alongside global pressures, weather-related concerns are also in focus. The report points to the possible influence of El Niño conditions, which could lead to below-average rainfall during the southwest monsoon season. Such a scenario may impact agricultural output and add to price pressures, particularly in food items.

Despite these risks, India’s internal growth drivers continue to provide stability. Strong consumption demand, ongoing public investment and a well-capitalised banking system are expected to cushion the economy against external shocks. Key financial indicators, including liquidity levels and asset quality, remain stable, reducing the likelihood of systemic stress.

Earlier projections had indicated a growth rate of around 7 to 7.4 percent for the current fiscal period, with the economy estimated to expand by 7.6 percent in 2025–26. However, rising import costs and currency pressures could influence these expectations going forward.

The ministry also noted that recent trade agreements and supply chain diversification efforts may help India navigate global volatility while sustaining medium-term growth momentum.