World Bank cuts India's FY26 growth forecast to 6.3%

Citing global economic weakness and policy uncertainty, the World Bank on Wednesday trimmed India's growth forecast by 40 basis points to 6.3 per cent, just a day after the IMF revised its projection downward to 6.2 per cent for the financial year 2025-26 (FY26).

- RUCHIKA CHITRAVANSHI

The RBI too recently cut India's growth forecast to 6.5 per cent from 6.7 per cent estimated earlier.

In its October 2024 projection, the World Bank had pegged India's economic growth at 6.7 per cent.

"The benefits to private investment from monetary easing and regulatory streamlining are expected to be offset by global economic weakness and policy uncertainty," said the multilateral lending agency in its bi-annual South Asia Development Update report.

It said that export demand will be constrained by shifts in trade policy and slowing global growth, though private consumption is expected to benefit from tax cuts, and improved implementation of public investment plans should boost government investment.