The World Bank has projected India’s economy to grow at 6.7% in the next fiscal year, starting in April, slightly higher than the growth rate forecast for the current fiscal year.
Despite the decline in the growth rate from 8.2% in the previous period, India continues to lead the growth charts among major economies.
The World Bank’s Global Economic Prospects, released on Thursday, estimates the growth rate for the current fiscal year at 6.5%.
However, it noted that India’s services sector is expected to maintain its robust expansion, while manufacturing activity is likely to strengthen, supported by government initiatives aimed at improving the business environment.
World Bank Highlights Global Growth
The World Bank highlighted that global GDP growth has remained stagnant at 2.7% since 2023, with projections extending through 2026. India remains the fastest-growing major economy in the world, surpassing others like China and the United States.
China follows India with a projected growth of 4.5% in the current calendar year, slowing to 4% next year. In contrast, the United States, the world’s largest economy, is expected to experience slower growth, with a projection of 2.3% this year and 2% next year.
World Bank Warns For Risks From Trade Tensions
The report also warned about the potential risks to the global economy, particularly from trade tensions and tariff hikes. While the World Bank did not specifically mention US President-elect Donald Trump, who has threatened to disrupt global trade, it cautioned that “adverse trade policy shifts in major economies” could affect India’s growth prospects.
World Bank’s Growth Projections For India
The World Bank’s growth projections for India align closely with the United Nations’ projections, which predict a 6.6% growth rate for this calendar year and 6.8% for the next. The World Bank attributed the slowdown in India’s growth from 8.2% in 2023-24 to 6.5% in the current fiscal year primarily to a decline in investment and weak manufacturing performance.
Despite the slowdown, India’s economy remains resilient and is poised to continue its strong growth trajectory in the coming years.
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