India’s economy is powering ahead despite global headwinds and geopolitical tensions, according to the latest RBI bulletin released on Friday. The Reserve Bank of India highlights how recent trade agreements with the European Union and an interim framework with the United States will bolster the nation’s growth trajectory for years to come.
RBI Governor Sanjay Malhotra emphasized that controlled inflation provides room to support expansion while maintaining financial stability. ‘We remain committed to meeting the economy’s productive needs and sustaining growth momentum,’ he stated in the bulletin.
High-frequency economic indicators point to robust activity continuing into the third quarter of 2025-26 and beyond. Real GDP growth is projected at 7.4% for 2025-26, a significant jump from the previous year. Private consumption and sustained investments have cushioned the economy against global pressures, even as net external demand weakened due to higher imports over exports.
On the supply side, services have led the charge, complemented by improving manufacturing. Real GVA growth is expected at 7.3% for the year. Looking to 2026-27, agriculture benefits from healthy reservoir levels, strong rabi sowing, and favorable crop conditions.
Corporate performance is strengthening, the unorganized sector is recovering steadily, and construction remains resilient. Domestic demand will keep services stable. Rural demand holds firm, fueled by better agricultural output and improving labor markets.
These trade pacts mark a historic step, positioning India for enduring prosperity amid uncertain times. The RBI’s outlook underscores resilience and strategic foresight in navigating international challenges.