India's Economy Expected to Post 6.4% Growth Rate in 2024, UN Says

India's Economy Projected to Grow at 6.4% in 2026 and 6.6% in 2027

According to a report released by the United Nations Economic and Social Commission for Asia and the Pacific (ESCAP), India's economy is expected to grow at 6.4% in 2026 and 6.6% in 2027. This projection is part of the Economic and Social Survey of Asia and the Pacific 2026 report, which provides an in-depth analysis of the region's economic trends.

The report notes that economies in South and South-West Asia grew by 5.4% in 2025, a 0.2% increase from the previous year. This growth was largely driven by India's strong performance, with the country's economy expanding by 7.4% in 2025. The report attributes this growth to robust consumption, particularly from the rural economy, as well as goods and services tax rate cuts and export frontloading ahead of the United States' tariffs.

However, the report also notes that economic activities in India moderated in the second half of 2025, as exports to the United States declined by 25% following the introduction of 50% tariffs in August 2025. Despite this, the services sector remained a key growth driver for the country.

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The report projects that India's inflation rate will remain stable at 4.4% in 2026 and 4.3% in 2027. Additionally, foreign direct investment (FDI) inflows to developing Asian and Pacific economies declined by 2% in 2025, despite a 14% increase in global flows.

Personal remittances, sent by Asian and Pacific workers employed outside of their home countries, continued to rise, cushioning the impact of vulnerable domestic employment conditions. However, remittances are facing headwinds, particularly in India, which received USD 137 billion in remittances in 2024 and could face a sizeable loss as the United States has levied a 1% tax on all remittances since January 2026.

The report also highlights the growth of the renewable energy sector, with an estimated 16.6 million green jobs globally, and an annual job creation of around 0.8 million between 2012 and 2024. India is expected to play a significant role in this growth, with 7.3 million green jobs in China, 1.3 million in India, and 2.5 million in the rest of Asia.

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The report notes that governments can leverage the energy transition to foster new domestic industries and build supportive constituencies. Public investment and targeted industrial policies can accelerate the emergence of beneficiaries such as renewable manufacturers, grid developers, storage providers, and green industrial clusters. India's production-linked incentive scheme is cited as an example of how macroeconomic policy can foster green industrial development.