Global investment bank Goldman Sachs has raised its forecast for India’s economic growth in calendar year 2026 to 6.8 per cent, expressing greater confidence in the country’s outlook amid easing inflation, lower oil prices and improving domestic demand.
The revised projection is higher than the bank’s earlier estimate of 6.5 per cent. Goldman Sachs also lowered its forecasts for inflation and the current account deficit, saying recent geopolitical developments and softer crude oil prices have improved India’s macroeconomic outlook.
According to the bank, easing tensions in West Asia have reduced concerns over energy prices, providing relief to an economy that imports a large share of its crude oil requirements. Lower oil prices are expected to help keep inflation under control, improve household spending power and reduce pressure on India’s import bill.
Goldman Sachs now expects inflation to remain lower than previously anticipated, giving the Reserve Bank of India (RBI) more room to support growth if required. Softer inflation could also help consumers by easing the cost of everyday goods and services.
The investment bank believes India’s domestic economy remains resilient, supported by steady consumption, continued government infrastructure spending and improving private investment. Strong economic fundamentals, it said, are helping India withstand uncertainties in the global economy.
The report also projects a narrower current account deficit, reflecting lower energy import costs and a favourable external environment. A smaller deficit is generally seen as positive because it indicates reduced dependence on foreign capital to finance imports.
Despite ongoing global challenges, including trade uncertainties and slowing growth in some major economies, Goldman Sachs expects India to remain one of the fastest-growing large economies in the world. The bank believes the country’s structural growth drivers, including rising consumption, manufacturing expansion and digitalisation, remain intact.
Economists say the upgraded forecast reflects growing confidence in India’s ability to maintain stable growth even amid external shocks. Lower inflation and easing commodity prices are expected to provide additional support to businesses and consumers over the coming months.
The improved outlook is likely to strengthen investor sentiment and reinforce expectations that India will continue to play a leading role in driving global economic growth in 2026.
