May 13: India’s economic growth is projected to remain strong at around 6.7% in FY27, supported by steady domestic demand, resilient consumption, and ongoing investment activity, according to Morgan Stanley. The global brokerage also expects the Reserve Bank of India (RBI) to maintain a steady policy stance through the current fiscal year, keeping interest rates unchanged to support macroeconomic stability.
The outlook reflects confidence in India’s ability to sustain its position as one of the fastest-growing major economies, even amid a challenging global environment marked by uneven growth and policy uncertainty in advanced markets.
Analysts believe that strong rural demand, improving urban consumption, and continued government capital expenditure will play a key role in driving growth over the medium term. Infrastructure spending, manufacturing incentives, and digital expansion are also expected to support economic momentum.
On the monetary policy front, Morgan Stanley anticipates that the RBI will prioritise inflation control and financial stability, opting to keep rates steady unless there is a significant shift in inflation or growth trends. This approach, it noted, could help anchor market expectations and support investor confidence.
Inflation is expected to remain within the central bank’s comfort range, although global commodity price movements and weather-related risks could still influence short-term trends.
Overall, the report suggests that India’s growth story remains intact, with strong domestic fundamentals likely to cushion the economy against external headwinds while policy stability continues to support long-term expansion.
