New Delhi: The Indian economy would be the fastest pace among G-20 economies in 2026-27, Moody’s Ratings said. The country GDP is projected to grow at 6.4 per cent in Fy27. The global ratings India’s growth would be driven by strong domestic consumption, policy measures, and a stable banking system.
Indian Banking Sector Outlook
Moody’s released is report on the Indian banking system which projected that the asset quality of the domestic lenders will remain resilient, with some stress among micro, small and medium enterprises (MSMEs).
The financial services provider predicted the operating environment for banks will to remain strong in 2026, supported by robust macroeconomic conditions and structural reforms.
Moody’s Insights on GDP, Inflation & Monetary Policy
“We forecast India’s real GDP will grow 6.4 per cent for fiscal 2026-27, the fastest pace among G-20 economies, driven by strong domestic consumption and policy measures.
“The rationalization of the goods and services tax (GST) in September 2025 and an earlier increase in personal income tax thresholds will help improve affordability for consumers and support consumption-led growth,” Moody’s said.
Notably, Finance Ministry’s Economic Survey tabled in Parliament has predicted India’s economy to grow at 6.8-7.2 per cent range in the next fiscal.
The inflation would remain under control, Moody’s said, adding that RBI will further ease monetary policy in fiscal 2026-27 only if there are signs of a slowdown in economic activity.
Moody’s expects system-wide loan growth to accelerate slightly to 11–13 per cent in fiscal 2026–27, from 10.6 per cent in fiscal 2025-26 YTD.
“Corporate loan quality will remain healthy, supported by strong balance sheets and improved profitability among large companies. Recoveries will taper as banks have resolved stressed loans to large corporate,” Moody’s said.
With PTI inputs