OECD sees India growing at 6.7% in FY26, S&P at 6.5%

NEW DELHI: The Organisation for Economic Cooperation and Development (OECD) on Tuesday lifted India’s economic growth forecast by 40 basis points for 2025-26, citing monetary and fiscal policy easing and reforms linked to the Goods and Services Tax (GST).“In India, higher tariff rates will weigh on the export sector, but overall activity is anticipated to be supported by monetary and fiscal policy easing, including the reform to the Goods and Services Tax, with growth projected to be 6.7% in 2025 and 6.2% in 2026,” the Paris-based OECD said in its economic outlook.In a separate report, S&P Global Ratings retained India’s GDP growth at 6.5% for the current fiscal year, citing robust domestic demand. “We expect domestic demand to remain strong, supported by a largely benign monsoon season, cuts in the income and the goods and services tax, and accelerating govt investment. GDP growth in the June quarter was better than we expected at 7.8%,” the agency said in a report. The ratings agency expects China’s economy to slow to about 4% year-on-year in the second half of 2025 and 2026 due to weakening exports, tepid organic domestic demand, and contained macro stimulus. Downward pressure on prices will persist, it said.