India holds crown as fastest-growing economy with IMF projecting 7 pc growth in current calendar year

United Nations, July 8 (SocialNews.XYZ) Astutely navigating the shoals of global economic uncertainties, India is holding on to its crown as the world’s fastest-growing major economy with the International Monetary Fund (IMF) projecting it to grow at 7 per cent during the current calendar year.

The World Economic Outlook (WEO) Update released on Wednesday projected India’s gross domestic product to moderate in the next calendar year to 6.4 per cent.

The Indian economy’s projected performance is "supported by strong momentum in private consumption and services activity", the report said.

The report gave two sets of projections based on time periods for India -- for the fiscal year in the main chart and for the calendar year in a footnote explanation to the chart.

The projections on the basis of India’s fiscal year starting in April used in the report’s main chart and in the text put the growth at 6.4 per cent for the current fiscal year and rising to 6.7 per cent the next fiscal year.

India keeps the fastest-growing major economy rank on the fiscal year projections also.

The WEO Update reduced the fiscal year projection made in the main WEO in April by 0.1 per cent for the current fiscal year but increased it by 0.2 per cent for the next.

The fiscal year basis of growth was 7.7 per cent in 2025-26 before the Iran war had its impact, according to the WEO Update.

India’s growth projections are more than twice the global numbers.

The report gave a 3 per cent projection for the world economy’s growth this year, and expected it to rise to 3.4 per cent next year.

But it presented a relatively positive outlook for the world.

"The global economy as a whole has, so far, weathered the shock from the war better than feared," the IMF said.

"Movements in and repercussions from the main channels of transmission -- commodity prices, inflation expectations, and financial conditions -- have been relatively limited," it said.

“The effects of the war in the Middle East (are) being partly offset by accelerated demand-driven momentum in the global technology cycle thanks to advances in artificial intelligence and its adoption," it added.

China, which is the second fastest-growing economy, was projected to grow by 4.6 per cent this year and lose a half point, falling to 4.1 per cent next year.

The US ranked third with a projected growth of 2.3 per cent this year and 2.2 per cent next year.

US President Donald Trump in a recent TV interview indicated that India’s high growth rate could be a benchmark for the US.

"You have a couple of countries, India is one, doing very well, but it's at 7, 8 per cent," he said.

But the US, Trump said, is being held back from an ambitious growth target by a conservative Federal Reserve that is keeping the interest rates high.

The European Union’s growth projection is a paltry 0.9 per cent this year and1.2 per cent the next.

The IMF’s rating of India’s growth is within the ranges set by several other organisations and banks, all of which mark India as a high-flyer.

The World Bank, in a report last month, said India was expected to grow by 6.6 per cent this fiscal year, rising to 7.2 per cent the next.

The UN said India was expected to grow by 6.4 per cent this year.

"We have seen structurally very robust growth in India, which has been driven by consumer demand, by public investment, but also by strong performance in services exports," Ingo Pitterle, the UN’s senior economist heading its Global Economic Monitoring Branch, said when the report was released last month.

The Reserve Bank of India, also last month, set this fiscal year's growth at 6.6 per cent.

A Bank of America report said India’s GDP growth in 2026 is expected to touch 7 per cent, up from an earlier estimate of 6.2 per cent in April.

And, late last month, Goldman Sachs upgraded India's GDP growth forecast for calendar year 2026 to 6.8 per cent from 6.5 per cent.

Source: IANS