New Delhi. The Indian economy has once again shown strength amid the ongoing economic and geopolitical tensions at the global level. Rating agency Moody's has increased India's real GDP growth forecast for financial year 2026-27 from 6 percent to 7 percent. According to the agency, the strength of domestic demand and investment is supporting the economy.
GDP figures also showed strength
The latest indication of India's economic growth was found in the data for the first quarter of the financial year 2026-27. Real GDP growth in the April-June quarter was recorded at 7.8 percent. This indicated that despite external pressures, the country's domestic economic activities remained strong.
Investment and consumption become big supports
Strong domestic economy is one of the important reasons behind the change in Moody's estimate. Private consumption, investment, manufacturing and service sector activities have given impetus to growth. This means that despite increasing uncertainty in the global market, India's economy does not have to depend only on foreign demand.
Still challenged by expensive oil
However, the picture is not completely free from risk. Tension in the Middle East and rising energy prices remain a matter of concern for India. Apart from increasing the import bill, expensive crude oil can also affect inflation and domestic expenditure. Apart from this, there is also a possibility of increase in pressure on food prices due to El Nino.
Domestic market becomes a protective shield
India's large domestic consumer market supports the economy amid global shocks. This is the reason that despite challenging external conditions, activities related to investment, consumption and services are helping in maintaining the pace of growth.
Moody's new estimate gives positive signals about India's current economic strength, although factors like oil price, global demand and food inflation will remain important in the future picture.