Team SKM,
India’s economy is expected to remain the fastest-growing among G-20 nations through 2027, with Moody’s Ratings projecting an average annual growth rate of 6.5% despite higher US tariffs and global trade headwinds.
According to Moody’s Global Macro Outlook 2026–27 report released on November 12, the country’s resilience is being driven by strong infrastructure investment, steady consumer demand and export diversification, even as private capital spending remains cautious.
Moody’s said India has managed to navigate US tariff pressures by redirecting exports to other markets. While shipments to the US fell 11.9% in September, overall exports rose 6.75%, underscoring the economy’s growing flexibility in global trade.
The agency added that India’s macroeconomic stability is supported by a neutral monetary policy stance and moderate inflation. The Reserve Bank of India held its repo rate steady in October, maintaining a balance between controlling prices and supporting growth.
Moody’s also noted that healthy foreign capital inflows and positive investor sentiment have helped cushion external shocks and maintain liquidity. However, it said the private sector is yet to fully regain confidence for large-scale investments, even as domestic consumption continues to be the main driver of growth.
Globally, Moody’s expects GDP growth to stay steady but uneven at around 2.5–2.6% in 2026 and 2027. Advanced economies are projected to expand about 1.5%, while emerging markets, led by India, are likely to grow close to 4%.
The report highlighted that the United States is seeing moderate momentum supported by AI-driven investment, while Europe’s outlook has improved slightly on the back of wage stability and fiscal support. China, meanwhile, is expected to grow 5% in 2025 before slowing to 4.2% by 2027 as consumption and investment remain weak.
For India, Moody’s said, the message is clear: a broad economic base, controlled inflation, and steady policy are helping the country withstand external shocks and stay firmly on track for sustained growth over the next two years.