By Priya Raghuvanshi

Copyright timesnownews

India’s economic performance in the first half of FY 2025-26 has remained solid, thanks to a combination of strong domestic consumption, increased investment activity, and continued public spending. The moderation in inflation, supported by stable food prices and reforms under GST 2.0, has further reinforced the macroeconomic environment. An official statement noted that the external sector remained well-balanced, liquidity conditions were stable, and financial markets were healthy, contributing to an overall picture of macroeconomic stability. RBI Maintains Repo Rate at 5.50 per cent, Cites Balanced Outlook Following the 57th meeting of its Monetary Policy Committee (MPC), the Reserve Bank of India (RBI) opted to keep the repo rate unchanged at 5.50 per cent, maintaining a neutral stance. “It signals a balanced approach that supports economic momentum while ensuring financial stability. The report further highlights resilient domestic demand, supportive financial conditions, and a stable external sector, reflecting a cautiously optimistic outlook for the Indian economy,” according to the government. The central bank also revised its GDP growth projection for FY 2025-26 upward to 6.8 per cent, up from its earlier forecast of 6.5 per cent. “Domestic growth is performing well due to strong consumption, investments, and government spending, with supportive factors like a good monsoon, GST 2.0, better credit flow, and rising capacity utilisation sustaining the positive outlook,” the official statement added. GDP Accelerates in Q1 FY26; Consumer Sentiment Stays Strong India’s real GDP climbed 7.8 per cent in Q1 FY26, up from 7.4 per cent in the prior quarter—its fastest pace in nearly two years—driven primarily by investments and household spending. Consumer sentiment also remained upbeat. The Future Expectations Index, which measures consumers’ economic outlook, showed strengthened optimism among both urban and rural households. Global Agencies Echo Confidence in India’s Growth Path Multiple global organisations continue to project India as a standout performer amid global uncertainties. Here’s the forecast GDP growth for FY26 and FY27: IMF: 6.4 per cent (FY26) Fitch Ratings: 6.9 per cent (FY26), 6.3 per cent (FY27) S&P Global: 6.5 per cent (FY26) United Nations: 6.3 per cent (FY26), 6.4 per cent (FY27) CII: 6.4–6.7 per cent (FY26) OECD: 6.7 per cent (FY26) These agencies highlight India’s resilient domestic demand, growing investment trends, and a stable external position as key growth enablers. Structural Reforms and Services Sector Drive Outlook Strong policy continuity, structural economic reforms, and a dynamic services sector are acting as additional tailwinds. Together, these factors underline broad confidence in India’s ability to sustain robust growth, even as the global economic environment remains uncertain.