IMF Cuts India's FY26 Growth Forecast to 6.2% Amid Trade Tensions

The International Monetary Fund (IMF) on Tuesday pared its FY26 growth forecast for India by 30 basis points to 6.2 per cent, citing escalating trade tensions and mounting global uncertainty, in its latest World Economic Outlook (WEO).

- Ruchika Chitravanshi

"For India, the growth outlook is relatively stable at 6.2 per cent in 2025 (2025-26), supported by private consumption, particularly in rural areas, but this rate is 0.3 percentage point lower than that in the January 2025 WEO update on account of higher levels of trade tensions and global uncertainty," the multilateral lending agency said.

The WEO stressed that a swift escalation of trade tensions has generated extremely high levels of policy ambiguity, complicating efforts to establish a central global growth outlook.

Under its reference forecast, the IMF sees global growth rate falling from an estimated 3.3 per cent in 2024 to 2.8 per cent in 2025—down 50 basis points from the January forecast—before recovering to 3 per cent in 2026, 30 basis points lower than the previous projection, with downward revisions across nearly all countries.