India's economic growth to slow to 6.8% FY27 amid West Asia crisis, El Nino impact
India Ratings & Research has lowered its GDP growth projection for India to 6.8% for FY27, citing risks from the West Asia conflict, currency depreciation, and El Niño. Despite the slowdown, the agency expects lower crude oil prices to provide some relief to the current account deficit.
Why it matters
Economic growth forecasts influence investor sentiment and government fiscal policy planning.
India Ratings & Research on Tuesday (August 18, 2026) projected India's GDP growth to slow down to 6.8% in the current fiscal year, as against 7.6% in the previous year, citing risks from fuel and food inflation stemming from West Asia conflict's uncertainty, weak currency, and the likely impact of El Niño on agriculture.
The FY27 GDP growth projection at 6.8 per cent is a tad higher than the 6.7% growth Ind-Ra had projected in May.
Earlier this month, the Reserve Bank of India (RBI) had raised growth projections from 6.6% to 6.7% citing resilient domestic economy.
The domestic rating agency said it now estimates the average crude oil price at $85 per barrel in FY27, compared to $95 per barrel in May 2026. It expects the rupee-dollar exchange rate to average ₹93.98 (May 2026: ₹94.28), a depreciation of 6.4% YoY, in FY27.
Get smarter about the news
Sign up free for a feed built around what you actually care about, Dive Deeper research on any story, and the full text of every article.
Create free accountAlready have an account? Sign in