India to grow at 6.4% this year, 6.6% in 2027: United Nations

Amid the ongoing global disruptions due to the Iran war, the United Nations has revised India’s growth outlook saying that the country is projected to grow at 6.4 per cent this year and 6.6 per cent in 2027. Inflation for the country is projected to be 4.4 per cent this year and 4.3 per cent in 2027.

The United Nations Economic and Social Commission for Asia and the Pacific (ESCAP) said in a report that the economies in South and South-West Asia grew by 5.4 per cent in 2025, compared to 5.2 per cent in 2024, driven largely by strong growth in India.

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India’s growth edged up to 7.4 per cent in 2025, supported by robust consumption, especially from the rural economy along with goods and services tax rate cuts, and export frontloading ahead of the United States’ tariffs, the report said.

In 2025, the economic activities moderated in the second half of 2025 as exports to the United States declined by 25 per cent following the introduction of 50 per cent tariffs in August 2025.

On the Foreign Direct Investments, the UN report said the FDI inflows to developing Asian and Pacific economies declined amid trade tensions and geopolitical uncertainty.

FDI inflows increased by 0.6 per cent in 2024, and declined by 2 per cent in 2025, even as global flows increased by 14 per cent.

According to the UN report, the largest share of greenfield FDI in the first three quarters were India, Australia, the Republic of Korea and Kazakhstan with $50 billion, $30 billion, $25 billion and $21 billion.

Personal remittances, sent by Asian and Pacific workers employed outside of their home countries, continued to rise.

In India and the Philippines, about 40 per cent of the transfers are used for essential spending, including medical expenses, of recipient households, the report added.

However, India could face a sizable loss as the United States has levied a 1 per cent tax on all remittances since January 2026.