NEW DELHI, Dec 4: Fitch Ratings has revised India’s GDP growth forecast for FY 2025-26 upwards to 7.4 percent, citing stronger consumer spending and the positive impact of Goods and Services Tax (GST) reforms. The agency noted that India’s domestic demand remains resilient, supported by rising household consumption and improved tax compliance.
According to Fitch, the implementation of GST reforms has streamlined indirect taxation, boosted revenue collection, and enhanced efficiency in the economy. These measures, combined with robust consumer activity, are expected to sustain momentum in growth over the medium term.
The ratings agency highlighted that India’s economic fundamentals remain strong, with inflation moderating and investment activity picking up. It added that government initiatives aimed at infrastructure development and digitalisation are further contributing to growth prospects.
Fitch also observed that global headwinds, including geopolitical tensions and slower growth in advanced economies, may pose challenges. However, India’s large domestic market and policy reforms are expected to cushion the impact and maintain steady expansion.
The upward revision of India’s GDP forecast underscores confidence in the country’s economic trajectory and reflects the effectiveness of structural reforms undertaken in recent years. Fitch reiterated that India remains one of the fastest-growing major economies in the world.
