Moody’s Slashes India’s GDP Forecast To 6% From 6.8% Amid Middle East Conflict
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Moody's has slashed India's economic growth estimates for the current fiscal to 6% from 6.8% due to the ongoing conflict in West Asia. The conflict is expected to moderate growth momentum and raise inflation risks, with India relying heavily on imported crude oil and liquified petroleum gas from the region.
Moody's Ratings has cut India's GDP forecast to 6% from 6.8%. The ongoing Middle East conflict will impact India's economy. India imports 55% of its crude oil and 90% of its LPG from the region. The conflict will lead to higher fuel and transport costs, and food inflation. Moody's expects inflation to average 4.8% in FY27, up from 2.4% in FY26. The agency predicts subdued private consumption, softer industrial activity, and a weakening in gross fixed capital formation. India's real GDP growth was 7.5% in 2025, the highest among G-20 economies.
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