19 May,2026 06:41 PM IST | Mumbai | PTI
Representational pic
Rating agency ICRA has lowered India's GDP growth forecast for FY27 to 6.2 per cent from its earlier estimate of 6.5 per cent, citing elevated crude oil prices triggered by the ongoing West Asia crisis.
For FY26, ICRA has projected GDP growth at 7.5 per cent, slightly lower than the National Statistical Office's (NSO) Second Advance Estimate (SAE) of 7.6 per cent for the financial year.
"ICRA now assumes crude oil prices to average at USD 95/bbl in FY27, against our prior estimate of USD 85/bbl, given the ongoing stickiness in prices amid the stalemate in West Asia. Consequently, we have pared our baseline forecast for the FY27 GDP growth (at constant 2022-23 prices) to 6.2 per cent from the 6.5 per cent expected earlier," ICRA Chief Economist Aditi Nayar said.
The rating agency also said GDP growth in the fourth quarter of FY26 is expected to slow to a three-quarter low of 7 per cent from 7.8 per cent recorded in the third quarter.
According to ICRA, slower expansion in the industrial and services sectors is likely to have moderated GDP growth during the period, although the agriculture sector is expected to have shown slight improvement.
"However, a slower rise in manufacturing volumes, contraction in exports, and nascent signs of margin pressure amid the West Asia fallout may have weighed on the industrial gross value added (GVA) growth performance in the quarter. Consequently, we expect the GDP growth to have slowed to a three-quarter low of 7 per cent in Q4 2025-26, below the NSO's implicit estimate of 7.3% for the quarter, while remaining quite robust," Nayar said.
ICRA further said slowing global growth and shipping disruptions caused by the West Asia conflict affected India's merchandise exports in the March quarter of FY26. Merchandise exports declined 2.8 per cent year-on-year during the quarter after recording a modest 1.4 per cent rise in the December quarter.
This story has been sourced from a third party syndicated feed, agencies. Mid-day accepts no responsibility or liability for its dependability, trustworthiness, reliability and data of the text. Mid-day management/mid-day.com reserves the sole right to alter, delete or remove (without notice) the content in its absolute discretion for any reason whatsoever.
