India Leads G-20 in GDP Growth: Moody's Forecasts Bright Outlook
Moody's Ratings has projected India's GDP to grow 6.4% in fiscal 2026-27, the fastest among G-20 nations, driven by domestic consumption, policy measures, and a robust banking system. The report highlights resilience in asset quality, strong capitalization, and potential policy easing by the RBI.
- Country:
- India
In a striking projection, Moody's Ratings announced on Monday that India's GDP is expected to expand by 6.4% in the upcoming fiscal year, topping growth charts among the G-20 economies. This upward trajectory is attributed to vigorous domestic consumption, favorable policy measures, and a resilient banking system showing robust asset quality.
The international credit rating agency underlined that India's banking sector is likely to maintain its strength through 2026, buoyed by solid macroeconomic fundamentals and structural reforms. While the micro, small, and medium enterprises (MSMEs) might face some financial strain, Indian banks possess adequate reserves to comfortably absorb potential loan defaults.
Furthermore, Moody's hinted at possible monetary policy relaxation by the Reserve Bank of India (RBI) in fiscal 2026-27 should the economic pace decelerate. The current inflation control is bolstering confidence in a slightly accelerated loan growth forecast of 11-13% for the period, as Indian banks remain well-capitalized and supported by steady governmental backing.
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