By Anjali Sharma
WASHINGTON – Moody’s Ratings on Wednesday has revised its growth outlook for India, projected that the economy is likely to grow at a higher rate of 7% in the current fiscal.

It said the growth would be driven by broad-based economic momentum and resilience to energy supply shocks.

Moody’s Ratings has revised its growth outlook for India, projected that the economy is likely to grow at a higher rate of 7 per cent in the current fiscal.

Moody’s said in its Global Macro Outlook 2027-28 that near-term risks to growth persist, as household consumption remains vulnerable to “intensifying and broadening price pressures”.

Media reported that inflation is expected to remain close to the upper end of the Reserve Bank of India’s 2-6% target range, while a deficient southwest monsoon and strengthening El Niño conditions could weigh on agricultural output and rural demand, the report said.

“With the RBI on track to raise rates further, tighter monetary policy could delay the recovery in private investment,” Moody’s added.

“India’s broad-based economic momentum and demonstrated resilience to the energy supply shock warrant upward revisions to our 2026-27 growth forecasts to 7 per cent from 6.5 per cent,” it said.

Moody’s said robust consumption, improving investment dynamics and strong macroeconomic fundamentals suggest that the economy is well-positioned to sustain growth of around 7% over the medium term.

High-frequency indicators, including robust capital goods production and imports, accelerating industrial credit growth and rising capacity utilization, suggested that India may be on the cusp of a new private capital expenditure cycle after several years of corporate and banking sector balance sheet repair, the agency said.

It added that broader economic activity also remains strong, with expanding manufacturing and services purchasing managers’ indexes and double-digit year-on-year growth in goods and services tax revenue, vehicle sales and merchandise exports, it added.