ADB Growth Forecast: The Asian Development Bank (ADB) on Wednesday increased India’s growth forecast for the financial year 2025-26 from 6.5 percent to 7.2 percent. The main reason for this is the boost to domestic consumption due to the recent cut in GST rates.
This fast pace of the Indian economy will also help Asia to grow faster, which can now grow at the rate of 5.1 percent this year compared to the previous estimate of 4.8 percent.
adb report
“India’s growth forecast for 2025 has been revised downwards to 7.2 percent, reflecting a stronger-than-expected expansion in the second quarter,” ADB’s Asia Development Outlook report for December says. Tax cuts boosted consumption.” India’s economy grew at a rate of 8.2 percent during the second quarter ended in September, the highest in the last six quarters.
In the first quarter it was 7.8 percent. In this way, India has achieved a growth rate of eight percent in the first half of the current financial year. According to the ADB report, this strong growth is due to the strong expansion of manufacturing and service sectors on the supply side and growth in consumption and investment on the demand side. However, this Manila-based multilateral development bank has maintained its estimate for the financial year 2026-27 at 6.5 percent.
ADB’s inflation forecast
According to the report, better production of crops, good monsoon and GST reform have worked to keep food prices down. ADB has reduced the inflation estimate for FY26 to 2.6 percent, which was earlier 3.1 percent. It was told in the report that due to falling prices of vegetables and pulses, there has been a rapid decline in inflation in the last few months.
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