Moody’s Ratings has revised India’s FY2027 growth forecast down to 6% from its earlier estimate of 6.8%, attributing the downgrade to weaker private consumption driven by elevated energy prices amid the ongoing conflict in the Middle East. This projection is notably below the Reserve Bank of India’s forecast of 6.9%. The RBI has estimated first-quarter growth at 6.8%, according to data released on April 8, against a backdrop of mounting concerns over rising oil prices and potential supply chain disruptions.
Moody’s report, released on Tuesday, notes that higher energy costs are likely to widen India’s trade deficit, given the economy’s heavy reliance on imported fuel. In addition, possible disruptions in the economies of the Gulf Cooperation Council (GCC) could weigh on remittance inflows from Indian workers abroad, further straining the current account deficit.
