US Based Goldman Sachs Lifts India’s Growth Forecast

NEW YORK- US-based global investment bank Goldman Sachs has raised India’s GDP growth forecast to 6.8 per cent for calendar year 2026 from 6.5 per cent earlier, following the US-Iran peace deal that has led to lower global oil prices and eased supply chain disruptions.

Goldman Sachs has also raised its FY27 GDP growth forecast for India by 40 basis points to 6.5 per cent.

In its latest report, Goldman Sachs said it had revised its forecasts after the sharp decline in crude oil prices reduced risks to the Indian economy.

The firm also lowered its headline inflation forecast by 0.2 percentage points to 4.4 per cent year-on-year and reduced its current account deficit forecast by 0.2 percentage points to 1.1 per cent of GDP. It now expects a balance of payments surplus of 0.7 per cent of GDP for the year.

The Goldman Sachs report said: “The Indian economy remained resilient through the Middle East shock, as fiscal and quasi-fiscal measures absorbed much of the increase in energy costs and limited pass-through to consumers.”

Goldman Sachs attributed the upward revision to stronger-than-expected economic activity in the first quarter of CY26 and lower crude oil prices. India’s real GDP grew 7.8 per cent year-on-year during the quarter, supported by resilient investment and robust services activity.

The report said softer global commodity prices are expected to reduce the government’s subsidy bill on fertilizers and petroleum products.

It also said lower oil prices and stronger remittance inflows would improve India’s external sector outlook.

Goldman Sachs, however, said weather-related uncertainties and the impact of earlier fuel price increases could remain short-term headwinds for consumption before the economy gathers further momentum later in the year. (IANS)