New Delhi: Deloitte India on Tuesday revised the lower band of its FY26 growth forecast, citing rising trade tensions and geopolitical uncertainty.
The consultancy now expects the economy to grow between 6.4% and 6.7%, down from its earlier projection of 6.5% to 6.7% made in May.
“The recent regional conflict and restrictions on critical minerals and specialised fertilizers are likely to affect the growth outlook,” Deloitte’s latest India Economy Outlook noted. “India’s growth story will be driven by a combination of robust domestic fundamentals and expanding global opportunities, amid uncertainties.”
The revision follows the US President Donald Trump’s decision last month to impose a 25% tariff on Indian exports, alongside the threat of additional trade measures, casting fresh doubt over bilateral trade flows and increasing pressure on Indian exporters.
Deloitte joins global institutions that have revised estimates for India’s growth.
The International Monetary Fund (IMF) raised its FY26 projection to 6.4% from 6.2%, citing sustained domestic strength and a relatively stable external environment. However, the Reserve Bank of India (RBI), which initially estimated 6.7% growth in February, pared its forecast to 6.5% in April, citing growing trade and tariff risks. Moody’s and S&P Global have both pegged growth at the same levelat 6.5%.
The last Economic Survey, released by the finance ministry, projected growth between 6.3% and 6.8% in FY26, balancing optimism with caution.
The Asian Development Bank, however, trimmed its estimate to 6.5% from 6.7%, citing similar concerns over US tariffs and softening trade momentum.
Despite these headwinds, Deloitte highlighted India’s relative strength in a volatile global landscape, noting that many peer emerging economies continue to struggle for stability.
“At the heart of India’s growth is its consumption-led economy. Private final consumption accounted for over 61% of GDP in FY 2024–25,” the report said. “With nearly 100 million middle- and high-income households expected to be added by 2030, India is on track to become one of the world’s largest consumer markets.”
India’s capital markets, it noted, remain a bright spot.
By December 2024, the market cap-to-GDP ratio had climbed to 136%, among the highest globally, it said.
The report also pointed to India’s growing talent advantage, with high artificial intelligence (AI) skill penetration and the addition of 2.5 million STEM (science, technology, engineering and mathematics) graduates annually. Over 1,700 global capability centres now anchor India’s role in digital and knowledge services.
“India’s economic trajectory stands out in a turbulent global landscape. Our momentum is driven by a virtuous trifecta, resilient capital markets, a…
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