New Delhi: India Ratings and Research (Ind-Ra) on Tuesday raised India’s GDP growth projection for the current fiscal to 7 per cent on the back of high growth in the June quarter and less impact of the US tariff hike on global growth and trade.

Ind-Ra expects GDP in FY26 to grow 7 per cent year-on-year (YoY), 70 basis points higher than its earlier forecast of 6.3 per cent (projected in July 2025), the rating agency said in a statement. The RBI has projected India’s GDP growth in the current fiscal year at 6.8 per cent, better than the 6.5 per cent expansion in the last fiscal year.

India’s real gross domestic product (GDP) grew at the fastest pace in five quarters at 7.8 per cent in the April to June period of FY26. The official data for Q2 (July-September) GDP growth estimates is scheduled to be released on November 28. Ind-Ra said both domestic and global landscapes have changed significantly since its last forecast in July 2025.

Major headwinds are the uncertain global scenario due to the US unilateral tariff hikes for all countries, with the tariffs on India being one of the highest since the end of August 2025. The major tailwinds for the economy since the July forecast are faster-than-expected inflation decline, increasing the real wage rate, especially in rural areas and GST rationalisation, said Ind-Ra Chief Economist and Head Public Finance, Devendra Kumar Pant.

The two major factors for the sharp upward revision in growth forecast are sharper-than-expected GDP growth in the June quarter and the impact of the US tariff hike on global growth and trade being lower than the estimated earlier.