New York: As global economic growth slows down amid the West Asia crisis, India is projected to register 6.3 per cent growth in 2026–27 (FY27) and 6.4 per cent in 2027–28 (FY28), the Organisation for Economic Cooperation and Development (OECD) said.
In the emerging-market economies, China’s growth is projected to ease from 5.0 per cent in 2025 to 4.5 per cent in 2026 and 4.3 per cent in 2027, as energy-related vulnerabilities and real estate sector adjustments weigh on activity despite mitigating factors such as the increasing share of renewables in the energy mix, adequate oil reserves and gasoline price caps, said the report.
“The conflict in the Middle East has become the dominant force shaping the global economic outlook. Energy prices and the prices of other key agricultural and industrial inputs produced in the Persian Gulf economies have soared since February as production and exports have been curtailed. This has been pushing up inflation, putting pressure on real incomes and economic growth. GDP growth projections have been revised down, while inflation has been revised up,” the report mentioned.
The Reserve Bank of India reduced the monetary policy rate from 6.5 per cent in January 2025 to a broadly neutral level of 5.25 per cent in February 2026 and average lending rates have fallen.
