New Delhi, May 13: Morgan Stanley has maintained a stable outlook for India’s economy, projecting real GDP growth of around 6.8% in 2026, even as the global economy grapples with elevated energy prices and persistent geopolitical uncertainty.
The global brokerage said India’s growth story continues to be anchored in strong domestic fundamentals, with resilient consumer demand, sustained public investment, and steady gains in manufacturing activity supporting overall momentum.
Domestic demand drives resilience
The report highlighted that India remains largely insulated from external shocks due to its dependence on domestic consumption rather than export-led growth. Strong household spending, infrastructure expansion, and a recovering private investment cycle are expected to remain key growth drivers.
Energy pressures remain a risk
While higher crude oil prices could temporarily push up inflation and widen the trade deficit, Morgan Stanley noted that India’s macroeconomic stability, policy flexibility, and strong foreign exchange buffers help cushion the impact of external volatility.
Positive medium-term outlook
Despite global headwinds, the outlook remains constructive, with India expected to stay among the fastest-growing major economies over the medium term, supported by structural reforms, urbanisation, and continued capital formation.
Overall, the assessment underscores India’s economic resilience, even in an environment shaped by energy shocks and uneven global recovery.