The World Bank has released a new report. According to this report, the fiscal deficit in India is expected to reduce, which is due to an increase in tax revenue. This trend is expected to contribute to the government's fiscal policies, the report said. The World Bank said fiscal deficits in most countries in South Asia are generally expected to remain poor, but India stands out with its improving fiscal position.
India's economy is expected to grow rapidly
Inflation in the sector is expected to decline further during the projection period due to stability in exchange rates. The report highlights that inflation in most countries, including India, Nepal, and Sri Lanka, is expected to remain within or below the target range. On the economic growth front, India is projected to retain its position as the fastest-growing economy among the world's largest economies. The World Bank has projected India's GDP growth at 6.7 per cent for both FY 2025-26 and FY 2026-27.
What did the World Bank say?
India's services sector will continue to grow, while manufacturing activity is expected to strengthen, supported by government initiatives to enhance infrastructure and streamline tax reforms, the bank said. Recovery in labour market, expansion of credit availability and moderation in inflation are expected to boost private consumption growth.
The report said that the services sector is expected to continue to expand, and manufacturing activity is expected to strengthen, which will be supported by government initiatives to enhance logistics infrastructure and improve the business environment through tax reforms.