India is likely to sustain economic growth of 7 per cent or more in 2026-27 (FY27), continuing the pace recorded in the years since the Covid-19 pandemic, Finance Minister (FM) Nirmala Sitharaman said on Sunday.
“Since then (Covid), we have been sustaining growth at 7 per cent or more. This year too our growth will be in that range,” Sitharaman said while addressing the Indian diaspora in Chicago, United States.
India was likely to maintain its growth momentum despite geopolitical uncertainties and supply-chain disruptions following the US-Iran conflict and the closure of the Strait of Hormuz, the finance minister noted. “Continuously keeping in touch with global uncertainties as much as understanding India’s own requirements have kept us floating. Whereas many countries are completely disturbed, their calculations have gone haywire,” she said.
The disruption in the Strait of Hormuz initially affected supplies of key commodities such as petroleum products, natural gas and fertilisers to India, but the country managed to reroute supplies, Sitharaman said.
The government has also kept fertiliser prices unchanged for farmers through subsidies despite a sharp rise in international prices, she said. “The forthcoming season will also require fertilisers from November. We are adequately stocked.”
Sitharaman said the government would continue with systemic reforms and seek to mobilise more capital, particularly from overseas, as India’s economy expands. While private investment has picked up domestically following the government’s push on capital expenditure, India also needs to attract international investment to meet its growing capital requirements, the FM said.
“Because of the ambitions that we have, we need capital. Therefore on my trip (to Canada and the US) and other ministers as well as the prime minister himself, all of us are talking to global funds,” Sitharaman said. “Showcasing what India has already done and hearing their expectations so that we can go back and provide clarity” is part of the effort, she added.
After contracting 5.8 per cent in FY21 amid the Covid-19 pandemic, the Indian economy has grown by more than 7 per cent in each of the last five years. For FY27, the economy is projected to grow 6.8-7.2 per cent, according to the Economic Survey for FY26, while the Reserve Bank of India (RBI) has estimated GDP growth at 6.7 per cent.
The statistics ministry will release data on gross domestic product (GDP) growth for the June quarter of FY27 on Monday.
Last week, Commerce and Industry Minister Piyush Goyal also visited Japan, where he pushed to mobilise investments worth $60 billion by 2035.
“We are also talking with several countries for the bilateral investment treaty along with bilateral trade agreement,” Sitharaman said.
The government’s push to attract overseas capital comes amid a sharp slowdown in net foreign direct investment (FDI) inflows into India over the past four years. Net FDI fell from an annual average of around $40 billion between FY20 and FY22 to $6.95 billion in FY26, according to RBI data.
