NEW DELHI, Dec 26: India is expected to remain one of the fastest-growing major economies in the world over the next two years, outperforming global consensus estimates, according to a fresh macroeconomic outlook by global investment bank Goldman Sachs released on Friday.
The firm projects India’s real GDP growth at 6.7 per cent in 2026 and 6.8 per cent in 2027, underlining the country’s growing resilience and structural strength amid a moderating global economy.
The forecast places India well ahead of most advanced and emerging economies, at a time when global growth is expected to slow due to tighter financial conditions, geopolitical uncertainties and lingering trade disruptions.
Goldman Sachs expects the world economy to grow at a relatively stable but modest pace of around 2.8 per cent in 2026, slightly above prevailing estimates, driven primarily by easing inflation and gradual monetary normalisation.
Within this global landscape, India stands out for its ability to sustain high growth without excessive reliance on exports. Unlike many economies that remain vulnerable to global demand fluctuations, India’s growth momentum is largely powered by domestic consumption, public investment and structural reforms.
A large internal market, rising household spending and continued government-led infrastructure expansion are expected to act as strong anchors for economic activity.
Public capital expenditure remains a key driver of India’s medium-term outlook. Continued investments in transport, logistics, energy and digital infrastructure are improving productivity, reducing bottlenecks and crowding in private investment.
These efforts are expected to support job creation, expand manufacturing capacity and strengthen supply chains, reinforcing India’s growth trajectory over the coming years.
Goldman Sachs also highlights India’s relatively lower exposure to global trade shocks compared to other emerging markets.
While exports remain important, the economy’s dependence on domestic demand provides a buffer against volatility arising from global trade tensions, protectionist policies or slowing growth in advanced economies.
This structural advantage is expected to help India maintain stable expansion even during periods of global uncertainty.
On the global front, the outlook suggests that inflation pressures are likely to ease across most major economies by late 2026. Stabilising commodity prices, improved supply chain efficiency and productivity gains are expected to support disinflation trends.
This could allow central banks to maintain more supportive or neutral monetary policies, creating a favourable environment for investment and growth, particularly in emerging markets like India.
Despite the optimistic outlook, the report flags certain risks that could influence global growth dynamics. One key concern is the weakening link between productivity gains and employment generation, especially in advanced economies.
Slower job creation could dampen consumer demand and affect global capital flows. Geopolitical tensions and policy uncertainty also remain potential headwinds, although India’s domestic-led growth model offers some insulation against these risks.
Compared with other major economies, India’s projected growth rates significantly exceed those of the United States, China and most developed markets.
While the US is expected to maintain steady growth supported by domestic demand and fiscal support, and China continues its transition to a more moderate expansion path, India’s growth outlook reflects a combination of demographic strength, reform momentum and sustained investment. (UNI)
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