India’s Growth Outlook Brightens: IMF and UN Upgrade Forecasts, Pakistan Left Awkward

New Delhi, January 16, 2026: The International Monetary Fund (IMF) and the United Nations have both raised their economic growth forecasts for India, signaling the country’s emergence as a key engine of global growth. Strong domestic demand and government investment are driving a significant upswing in the economy. The IMF is expected to revise India’s growth rate upwards in its upcoming World Economic Outlook report, which is positive news for the nation.

IMF spokesperson Julie Kozak indicated that India continues to play a crucial role in global economic growth. “India’s economy is showing strong momentum,” she said, adding that the IMF will likely raise its growth forecast for India above 6.6%, surpassing previous projections. The United Nations has also upgraded its estimates, projecting a growth rate of 6.6% for 2026 and 6.7% for 2027. These improvements are attributed to robust domestic consumption and accelerated government investment, which are mitigating the impact of U.S. tariffs on Indian exports.

The IMF’s praise of India as a global growth engine is particularly noteworthy given that Pakistan, which frequently turns to the IMF for financial assistance, continues to struggle. Recently, the IMF approved a bailout package worth $1 billion for Pakistan.

India’s Economy Shows Resilience

In a press briefing, IMF spokesperson Kozak highlighted India’s sustained economic strength. Earlier, the IMF had projected a 6.6% growth rate for the fiscal year 2025-26, primarily driven by rising domestic consumption. However, recent third-quarter growth data exceeded expectations, prompting the IMF to consider raising its forecast in the January update of the World Economic Outlook (WEO), scheduled for release in the coming days. Kozak emphasized that India is now seen as a major growth engine for the world economy.

The United Nations has also revised India’s growth estimates upward. While earlier projections for 2026 stood at 6.4%, they have now been increased to 6.6%, with 2027 expected to see 6.7% growth. According to the UN, strong private consumption and rapid government investment are key factors supporting these projections. These measures are expected to offset the impact of U.S. tariffs on Indian exports.

Policy Measures Supporting Growth

Recent policy initiatives by the Indian government, including income tax reductions, simplification of the Goods and Services Tax (GST), and lower interest rates, are also expected to accelerate economic growth. The UN’s World Economic Situation and Prospects 2026 report forecasts India’s GDP to grow by 7.4% in 2025.

IMF Managing Director Kristalina Georgieva told Reuters that the upcoming IMF report would highlight the resilience of the global economy, despite trade shocks. She noted that while global risks remain, the current performance demonstrates strength. The IMF’s World Economic Outlook update is scheduled for release on January 19, 2026. Georgieva also highlighted that geopolitical tensions and rapid technological changes are the main risks to global growth. She cautioned that heavy investment in artificial intelligence may not yield the expected productivity gains, potentially posing significant challenges to the global financial system.