India’s Growth Seen At 6.4% In 2026, 6.6% In 2027: UN Report
India’s economy is projected to grow at 6.4% in 2026 and 6.6% in 2027, according to the Economic and Social Survey of Asia and the Pacific 2026 released by United Nations Economic and Social Commission for Asia and the Pacific.
The report highlights India as the primary growth engine in South and South-West Asia, where regional growth rose to 5.4% in 2025 from 5.2% in 2024. India itself recorded a strong 7.4% expansion in 2025, driven by robust consumption, particularly in rural areas alongside GST rate cuts and export frontloading ahead of US tariff hikes.
However, momentum slowed in the latter half of 2025 as exports to the United States fell sharply by 25% following the imposition of 50% tariffs. Despite this, the services sector remained a key pillar of growth.
Inflation in India is expected to remain stable at 4.4% in 2026 and 4.3% in 2027.
The report also noted a decline in foreign direct investment (FDI) across developing Asia-Pacific economies, which fell 2% in 2025 amid global trade tensions, even as worldwide flows rose 14%. India remained a top destination for greenfield FDI, attracting about $50 billion in announced investments, alongside countries such as Australia, South Korea, and Kazakhstan.
Remittances continued to support household consumption across the region. As the world’s largest recipient at US$ 137 billion in 2024, India faces potential pressure following a 1% remittance tax introduced by the United States in January 2026.
On the sustainability front, the report underscored the growing importance of green jobs, with global employment in the sector reaching 16.6 million. India accounted for 1.3 million of these jobs, supported by policy initiatives such as the Production Linked Incentive (PLI) scheme.
ESCAP noted that targeted industrial policies, including incentives for solar modules, batteries, and green hydrogen, are helping India strengthen domestic manufacturing, reduce import dependence, and accelerate its transition to a sustainable economy.
