ICRA sees India GDP growth at 7% in Q1 FY27

India's GDP growth is forecasted to slow to a four-quarter low of 7 percent in the April-June quarter of the current fiscal year, according to rating agency ICRA. This figure represents a decline from 7.8 percent growth in the March quarter of the previous fiscal year. ICRA projects the industrial sector to expand at a rate of 7.7 percent, while the agricultural sector is expected to grow at a modest 4 percent.

The services sector, however, is anticipated to experience the strongest growth at 7.9 percent. For the full fiscal year 2026-27, ICRA anticipates GDP growth to ease to 6.7 percent, down from 7.7 percent growth in the preceding fiscal year. ICRA Chief Economist Aditi Nayar stated that high-frequency indicators from both the industrial and services sectors indicate a robust domestic volume growth in the June quarter of 2026-27, despite concerns about the impact of higher commodity prices resulting from the geopolitical conflict in West Asia.

Nayar further explained that the projected 7 percent growth for Q1 2026-27 aligns with the Monetary Policy Committee's growth forecast for the quarter.