The United Nations has lowered India’s economic growth forecast for 2026 to 6.4 percent.
However, it still expects India to remain one of the fastest-growing major economies in the world.
According to the UN’s World Economic Situation and Prospects report, India’s economy is expected to grow at a slower pace because of weak global economic conditions, trade tensions, and uncertainty in the international market.
The UN had earlier projected India’s GDP growth at 6.6 percent for 2026. The latest forecast reflects concerns over slower global demand and the impact of geopolitical tensions on world trade and investment.
Despite the downgrade, the report said India’s economy continues to be supported by strong domestic demand, government spending on infrastructure, and steady private consumption.
The report noted that India remains in a better position compared to many other large economies because of its strong services sector, digital growth, and public investment programmes.
However, the UN warned that external risks remain high. Rising global trade restrictions, geopolitical conflicts, and volatile energy prices could affect exports, investment flows, and manufacturing activity.
The report also highlighted concerns over higher borrowing costs globally and uncertainty in financial markets, which may create challenges for developing economies, including India.
The UN said global economic growth is expected to remain weak in 2026 due to ongoing geopolitical tensions and slowing trade activity.
India’s inflation situation has improved compared to earlier periods, but the report said food and energy prices continue to pose risks.
The report added that employment growth and private sector investment would remain important for maintaining India’s long-term economic momentum.
According to the UN, South Asia is expected to remain one of the fastest-growing regions globally, with India continuing to be the largest contributor to regional growth.
The report also said that structural reforms, infrastructure expansion, and digitalisation could support India’s medium-term economic outlook despite short-term global challenges.
