Goldman Sachs Upgrades India’s CY26 GDP Growth Forecast to 6.9%
In February 2026, Goldman Sachs upgraded India’s Calendar Year 2026 (CY26) real Gross Domestic Product (GDP) growth forecast by 20 basis points (bps) from 6.7% to 6.9%, following the conclusion of the United States of America (USA)–India trade deal that reduced reciprocal tariffs on Indian goods from 25% to 18%.
About the Forecast:
Basis: The estimate is based on goods export exposure of about 4%
of GDP to USA final demand and an export demand elasticity of around 0.7.
Investment: The deal is expected to reduce trade-policy uncertainty and improve private investment intentions, with capex recovery likely in the second half of CY26.
External: Lower tariffs are projected to narrow the Current Account Deficit (CAD) by about 0.25% of GDP to nearly 0.8% in CY26.
Currency: Easing trade tensions may support capital inflows and reduce pressure on the Indian Rupee (INR).
Trade: India’s bilateral goods trade surplus with the USA has doubled from about USD 20 billion in CY15 to nearly USD 40 billion in CY25.
Sectors: The surplus expansion has been driven mainly by electronics, pharmaceuticals, and textiles.