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According to a UBS Global Research report, India’s GDP growth is expected to average 6.5% in financial year 2028-30, making the country the third largest consumer market by 2026 and the third largest economy by 2028. UBS Chief Economist Tanvee Gupta Jain says India needs to focus more on structural reforms like land, capital and R&D to boost new economy sectors.
New Delhi. India’s economy is going to grow at a record pace in the next few years. According to the latest report by UBS Global Research, the country’s real GDP growth is expected to average 6.5 percent annually during the financial year 2028-30. This momentum could make India the world’s third-largest consumer market by 2026 and third-largest economy (after the US and China) by 2028.
UBS Chief India Economist Tanvee Gupta Jain said that India is currently in a strong position in terms of policy and investment, but to maintain forward momentum, more emphasis will be placed on structural reforms like land, capital and research and development (R&D).
Momentum created by strong demand and policy support
UBS estimates that India’s real GDP growth will remain stable at 6.4% in FY27 and 6.5% in FY28. The report says that this growth will remain sustained due to domestic consumption and supportive policies of the government. Despite rising global uncertainty, India’s macro-economic stability is expected to remain under control. According to UBS, headline CPI inflation could reach 4.3% in FY27, which is lower than the Reserve Bank of India’s (RBI) estimate of 4.5%. At the same time, Current Account Deficit is estimated to be only 1.2% of GDP, which is considered a comfortable level. Fiscal deficit will continue to improve gradually, while interest rates are likely to be cut by another 25 basis points in the remaining part of FY26.
Both risks and opportunities in the report
The UBS report has indicated that India’s growth may be on track, but the risks are also not less. If 50% trade tariffs continue for a longer period, FY27 GDP growth may fall by 50 basis points. Additionally, a 25% tax on payments by US companies to offshore service providers could further reduce growth by 90 basis points. On the positive side, rapid adoption of Artificial Intelligence (AI) will increase productivity and may increase GDP growth by 20 basis points. If India accelerates its structural reforms, this growth rate can reach between 6.5 to 7%.
Picture of India by 2028
This projection of UBS can be a big milestone in India’s economic journey. With strong demand, stable policies and a surge in new sectors like AI, India can not only become the world’s third largest economy but also emerge as Asia’s most dynamic growth story. The report makes it clear that if India maintains the pace of policy reforms and maintains a stable investment climate, its economic expansion can touch new heights in the coming three years.
