After peace talks in West Asia brought oil prices down and eased supply chain issues, Goldman Sachs has turned more bullish on the Indian growth story. The investment bank has raised its GDP growth forecast for India for the year 2026 to 6.8 per cent, up from the earlier projection of 6.5 per cent.
Additionally, the Financial Year 2026-27 GDP forecast has been boosted to 6.5%. Goldman Sachs stated that it revised its projections after the significant drop in crude oil prices reduced risks to the Indian economy and reduced Indian import bill.
In its report titled India: Improved Macro Outlook After The US and Iran deal, the global investment bank also lowered its headline inflation forecast by 0.2 percentage points to 4.4% and reduced its current account deficit estimate to 1.1% of GDP.
The oil prices have seen a sharp correction after the peace deal was agreed upon between US and Iran, and ships are only again starting to move freely through Strait of Hormuz. Even though the number of ships crossing the strait haven’t reached pre-war levels, the progress has been quite noticeable.
Indian service sector has seen robust investment and strong activity, contributing to the increase in the GDP growth forecast.
