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54m ago

World Bank Upgrades Outlook With India FY26 Raised to 7.2% as Tariff Fallout Stays Muted

The bank warns of concentrated gains with the 2020s on track to be the weakest growth decade since the 1960s.

Vehicles pass in front of the World Bank building in Washington, D.C. on May 20, 2022. Picture taken with a long exposure. REUTERS/Raphael Satter
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Overview

  • The World Bank now projects global GDP growth of 2.6% in 2026, with U.S. growth lifted to 2.2% on AI-driven investment and supportive tax incentives.
  • The report says the immediate impact of higher U.S. tariffs was smaller than feared due to import front-loading, delayed implementation, market diversification and bonded warehouse use.
  • India’s growth is forecast at 7.2% in FY26 on strong domestic demand, then 6.5% in FY27 assuming 50% U.S. tariffs persist, with further declines in poverty still expected.
  • China is seen slowing to about 4.4% in 2026 as emerging-market growth moderates to 4.0%, reinforcing concern that global gains are leaning toward advanced economies.
  • India’s growth comparisons could change with a new GDP base year due on Feb. 27, and outside analysis notes recent high averages are flattered by post‑Covid base effects.