New Delhi/New York: India’s economic trajectory remains positive with a projected growth rate of 6.4 per cent for 2026 and 6.6 per cent in 2027, according to the “Economic and Social Survey of Asia and the Pacific 2026” released by the United Nations. The report, issued by the Economic and Social Commission for Asia and the Pacific (ESCAP), highlights that India remains the primary engine of growth for the South and South-West Asian regions. Although the growth rate shows a slight moderation from the 7.4 per cent seen in 2025, the nation’s economic fundamentals continue to be supported by a robust services industry and resilient domestic demand.
The UN study detailed that while 2025 saw a boost from rural consumption and strategic tax cuts, the latter half of that year was challenged by significant trade hurdles. The imposition of 50 per cent tariffs by the United States in August 2025 resulted in a 25 per cent decline in exports to that market, impacting overall economic momentum. However, the report indicates a stabilizing trend for the coming years, with inflation expected to settle at 4.4 per cent this year and drop slightly to 4.3 per cent in 2027. This stability is expected to bolster investor confidence despite broader geopolitical uncertainties that have caused a minor dip in Foreign Direct Investment (FDI) across the Asia-Pacific region.
A major focus of the report is India’s leadership in green industrial development through its Production-Linked Incentive (PLI) programmes. The UN praised these schemes for effectively scaling up the domestic manufacturing of high-efficiency solar modules, batteries, and green hydrogen. By providing targeted incentives, India is not only reducing its dependence on imports but also creating a sustainable industrial base that supports the global energy transition. These projections closely mirror recent updates from the International Monetary Fund, which recently upgraded its own forecast for India to 6.5 per cent, citing a favourable outlook despite global volatility.
