RBI Governor Sanjay Malhotra highlighted a positive outlook for India’s economy in FY27, citing strengthening urban consumption, steady rural demand, and resilience in the services sector. While net external demand remains a drag, upcoming trade agreements with the EU and US, alongside budgetary measures, are expected to support exports and overall growth momentum.
The Reserve Bank of India (RBI) has projected a steady improving trajectory for the Indian economy in FY27, driven by robust domestic demand and supportive policy measures. Governor Sanjay Malhotra noted that urban consumption recovery is set to strengthen, while rural demand remains steady, ensuring balanced growth across sectors.
The services sector is expected to stay resilient, sustaining momentum in private consumption. However, the RBI acknowledged that net external demand continues to be a drag, reflecting global headwinds and trade imbalances.
On the external front, Malhotra emphasized that the India-EU Free Trade Agreement (FTA) and the India-US trade deal will provide medium-term support to exports, enhancing India’s competitiveness in global markets. He also underlined that measures announced in the Union Budget are conducive to growth, reinforcing domestic investment and consumption.
Key Highlights
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Urban consumption recovery to strengthen in FY27.
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Rural demand steady, supporting balanced growth.
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Services sector resilient, sustaining private consumption momentum.
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Net external demand remains weak, global headwinds persist.
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India-EU FTA & India-US trade deal to boost exports in medium term.
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Budget measures supportive of growth and investment.
Sources: ANI, Business Standard, Mint, Economic Times