Deloitte projects 6.5-6.8% GDP expansion in FY27, growth to strengthen in second half
Deloitte India's Economic Outlook report projected India's GDP to grow between 6.5% and 6.8% in FY27 (the financial year running April 2026 to March 2027)
Growth is expected to remain moderate in the first half of FY27 before strengthening in the second half
The pickup is attributed to stronger festive-season demand, monetary easing, and a gradual stabilisation in global economic conditions
The report noted that India entered calendar year 2026 with well-balanced ("Goldilocks") macroeconomic fundamentals, but that geopolitical developments — including tensions affecting shipping routes in the Middle East — introduced commodity-price volatility and weakened investor sentiment during the year
GDP Measurement Framework — MoSPI/NSO, Base Year, and Estimate Sequence
India's GDP is compiled by the National Statistical Office (NSO) under the Ministry of Statistics and Programme Implementation (MoSPI), following a sequence of estimates released through the year — First Advance Estimate (FAE), Second Advance Estimate, Provisional Estimate, and successive revisions.
Key Details
- The current National Accounts series uses base year 2011-12; MoSPI is in the process of revising this to a new base year of 2022-23
- The First Advance Estimate for FY26 (2025-26) placed real GDP growth at 7.4% (real GDP of ₹201.90 lakh crore against ₹187.97 lakh crore in FY25), and nominal GDP growth at 8.0%
- FAE is used as an input for the Union Budget; later estimates are progressively refined as more data becomes available
Deloitte's FY27 projection of 6.5-6.8% represents a moderation from the 7.4% real growth recorded in the FY26 First Advance Estimate, framing FY27 as a slower, more back-loaded growth year.
RBI Monetary Policy Committee — Growth-Inflation Trade-off
The Reserve Bank of India's Monetary Policy Committee (MPC) sets the policy repo rate to balance the inflation target against growth, under the flexible inflation-targeting framework established by amendment to the RBI Act, 1934 (Section 45ZA), targeting CPI inflation at 4% with a +/-2% tolerance band.
Key Details
- The RBI cut its own FY27 GDP growth forecast to 6.6% (from an earlier 6.9%) while raising its FY27 CPI inflation forecast to 5.1% (from 4.6%)
- The policy repo rate stood at 5.25% after the MPC kept it unchanged at its June 2026 meeting, maintaining a neutral stance
- The next MPC meeting was scheduled for August 3-5, 2026
Deloitte's 6.5-6.8% range brackets the RBI's own 6.6% FY27 estimate, and "monetary easing" cited by Deloitte as a second-half growth driver refers to the anticipated trajectory of repo-rate decisions by this same MPC framework.
Monetary Easing and the Interest Rate Transmission Channel
"Monetary easing" refers to a central bank lowering policy rates (or signalling future cuts) to reduce borrowing costs, stimulate credit growth, and support consumption/investment — a standard countercyclical tool distinct from fiscal stimulus.
Key Details
- Transmission works through banks' marginal cost of funds-based lending rate (MCLR) and repo-linked lending rate (RLLR) mechanisms, which adjust retail and corporate loan pricing in response to repo rate changes
- Easing cycles are typically pursued when growth risks are seen as outweighing inflation risks, within the MPC's mandated tolerance band
- Festive-season demand (Q3 of the fiscal year, coinciding with Diwali and related consumption) is a recurring seasonal driver referenced in most India growth outlooks for H2
Deloitte's H2 recovery thesis rests on the combined effect of anticipated rate easing feeding through to consumer/business credit, alongside seasonal festive demand and improving global conditions.
- Deloitte's FY27 (2026-27) GDP growth projection: 6.5% to 6.8%
- RBI's FY27 GDP growth forecast: 6.6% (revised down from 6.9%)
- RBI's FY27 CPI inflation forecast: 5.1% (revised up from 4.6%)
- FY26 real GDP growth (First Advance Estimate): 7.4%; nominal growth: 8.0%
- Current repo rate: 5.25% (unchanged since the June 2026 MPC meeting)
- Next scheduled MPC meeting: August 3-5, 2026
- GDP base year under revision: from 2011-12 to 2022-23