India’s GDP is expected to rise by 6.5% in fiscal 2026, according to a Crisil projection released Thursday. It also said that increased domestic consumption is projected to boost industrial activity.

The international ratings agency said in a report that it anticipated domestic consumer demand to strengthen this fiscal year due to “healthy agricultural growth, easing inflation supporting discretionary spending, rate cuts by the Reserve Bank of India (RBI)’s Monetary Policy Committee (MPC), and income tax relief.”

This fiscal year, the India Meteorological Department predicts an above-normal monsoon (106 percent of the long-term average), which is good news for inflation and agricultural output.

Additionally, Crisil Intelligence predicts that crude oil prices would stay low this fiscal year, ranging between $65 and $70 per barrel as opposed to $78.8 per barrel in the previous fiscal year.

After lowering the repo rate by 50 basis points (bps) till April, we anticipate that the MPC will lower it by an additional 50 bps this fiscal year. The paper states that “bank lending rates have started to ease, which should support domestic demand.”

With external obstacles providing negative risks, Crisil projects gross domestic product (GDP) growth of 6.5% overall in fiscal 2026.

IIP growth dropped in April during the month when the US made major tariff announcements. While some export-oriented industries, including chemicals and pharmaceuticals, saw a slowdown in production, others, like equipment and ready-made clothing, benefited from front-loading exports. Durables outperformed non-durables among consumer goods.

The performance of industrial products was uneven; production growth in capital goods increased significantly, while intermediate goods saw a little acceleration.

Despite the notable gain in goods exports (9.0 percent in April in nominal terms compared to 0.7 percent in the previous month), the performance of export-oriented industries was mixed in April.

According to Ministry of Statistics statistics, the output of consumer durables including TVs, refrigerators, and electrical devices increased by 6.4% in November, showing increased consumer demand for these products as earnings rose.

Large-scale government projects being carried out in the ports, railroads, and highways sectors helped the infrastructure sector increase by 4%.