World Bank Trims India’s FY26 Growth Forecast To 6.3 Percent Amid Rising Global Uncertainty

The World Bank has scaled down its expectations for India’s economic performance in 2025–26, lowering its growth forecast to 6.3 per cent from 6.7 per cent projected earlier in January.

In its June 2025 update of the Global Economic Prospects report released in Washington on Tuesday (10 June), the World Bank attributed the downgrade to a slowdown in exports and dampened investment activity, reported The Hindu.

While India is still expected to clock the fastest growth among the world’s major economies, the new projection reflects the growing impact of global trade barriers and weaker demand from key trading partners.

"Investment growth is expected to slow, primarily reflecting a surge in global policy uncertainty," the report noted.

The World Bank observed that India’s overall activity has moderated, with a slowdown in industrial production weighing down the momentum, though services remain steady and agricultural output is recovering.

Despite this, a rebound is expected as the growth is projected to rise to an average of 6.6 Per cent in FY27 and FY28, buoyed in part by strong services exports.

The global outlook also appears bleak.

The World Bank cut its global growth forecast to 2.3 Per cent , the weakest pace since 2008 outside of major recessions.