GST 2.0 Boost: OECD Lifts India’s FY26 Growth Forecast To 6.7%; S&P Retains 6.5% | Economy News

By Pune Media On Sep 24, 2025

Last Updated:September 24, 2025, 13:14 IST

OECD raised India’s 2025-26 growth forecast to 6.7 percent, citing GST reforms.

OECD Pegs India’s FY26 GDP at 6.7% on Reforms, S&P Holds 6.5% Forecast

India GDP Growth Forecast: Another world agency is seeing resilience in India’s growth outlook in FY2025-26 despite global turmoil triggered by multiple geopolitical conflicts, tariff war and the latest H-1B visa fee hike chaos.

The Organisation for Economic Cooperation and Development (OECD) on Tuesday hiked India’s economic forecast by 40 bps for 2025-26 to 6.7 per cent, thanks to monetary and fiscal easing and reforms linked to the Goods and Services Tax (GST).

OCED in its economic outlook said as quoted by TOI that higher tariff rates would weigh on the export sector, but overall activity is anticipated to be supported by monetary and fiscal policy easing, including the reforms to the Goods and Services Tax, with growth projected to be 6.7 per cent in 2025 and 6.2 per cent in 2026.

Meanwhile, S&P retained India’s growth outlook at 6.5 per cent for the 2025-26, driven by robust domestic demand.

S&P, in its report, said it expects domestic demand to stay strong, aided by a favorable monsoon, tax cuts, and rising government investment, adding that GDP growth in the June quarter, at 7.8%, exceeded its expectations.

Earlier, Ratings agency S&P Global had upgraded India’s sovereign rating to ‘BBB’ from its earlier ‘BBB-‘, while maintaining the outlook as ‘stable’.

The short-term rating has also been revised to ‘A-2’ from ‘A-3’, and the transfer and convertibility assessment has been upgraded to ‘A-‘ from ‘BBB+’.

“India is prioritising fiscal consolidation, demonstrating the government’s political commitment to deliver sustainable public finances, while maintaining its strong infrastructure drive,” S&P said in a statement.

S&P Global said the stable outlook reflects its view that “continued policy stability and high infrastructure investment will support India’s long-term growth prospects. That, along with cautious fiscal and monetary policy that moderates the government’s elevated debt and interest burden will underpin the rating over the next 24 months”.

Japanese credit rating agency Rating and Investment Information (R&I) has upgraded India’s long-term sovereign credit rating to ‘BBB+’ from ‘BBB’, while retaining the ‘stable’ outlook for the Indian economy, citing strong domestic demand, fiscal discipline, and improved external stability.

“Despite the uncertainties surrounding the global economic environment, India’s economy can be expected to maintain firm growth thanks to the economic structures driven by domestic demand and the policies of the administration of Prime Minister Narendra Modi,” R&I said in its India sovereign rating review published on September 19.

Business Desk

A team of writers and reporters decodes vast terms of personal finance and making money matters simpler for you. From latest initial public offerings (IPOs) in the market to best investment options, we cover al…Read More

Click here to add News18 as your preferred news source on Google. Stay updated with all the latest business news, including market trends, stock updates, tax, IPO, banking finance, real estate, savings and investments. To Get in-depth analysis, expert opinions, and real-time updates. Also Download the News18 App to stay updated.First Published:

September 24, 2025, 13:14 IST

News business economy GST 2.0 Boost: OECD Lifts India’s FY26 Growth Forecast To 6.7%; S&P Retains 6.5%Disclaimer: Comments reflect users’ views, not News18’s. Please keep discussions respectful and constructive. Abusive, defamatory, or illegal comments will be removed. News18 may disable any comment at its discretion. By posting, you agree to our Terms of Use and Privacy Policy.

_{Images are for reference only.Images and contents gathered automatic from google or 3rd party sources.All rights on the images and contents are with their legal original owners.}

_{Aggregated From –}

_{Source link}