India's GDP Growth Seen At 6.4% In 2026, UN Flags Export And FDI Pressures

India’s economy is projected to grow at 6.4% in 2026, according to a report released on April 20 by the United Nations Economic and Social Commission for Asia and the Pacific, which also estimated growth at 6.6% in 2027.

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As per the survey report, “Economic and Social Survey of Asia and the Pacific 2026,” growth in India was reported at 7.4% during 2025, which was aided by domestic consumption demand, especially in rural areas, as well as certain economic policies, including changes in the goods and services tax and export frontloading before tariffs in the U.S.

Decline in Exports Causes Moderation in Growth

According to the report, economic activities witnessed moderation during the second half of 2025, with a reduction in exports to the U.S. by 25%, following the imposition of 50% tariffs in August 2025. Despite this, the services sector continued to support overall growth, according to the United Nations.

In India, the inflation rate is expected to be 4.4% in 2026 and 4.3% in 2027, which signifies stability in prices.

Trends in Regional and Global Investments

The growth in the economy in South and South-West Asia was recorded at 5.4% in 2025 compared to 5.2% in 2024, which was mainly due to India, the report stated. On the other hand, while there was an increase of 14% in global foreign direct investments (FDI), foreign direct investments into developing Asian and Pacific economies fell by 2% because of geopolitical conflicts.

According to the report, India received investments worth $50 billion for greenfields in the first three quarters of the year, along with countries like Australia and the Republic of Korea.

Remittances And External Factors

The United Nations said remittances continued to support household consumption across the region. India was still the top receiver, with a total of $137 billion in receipts in 2024.

However, it was pointed out that a 1% tax levied on foreign remittances in January 2026 by the United States would affect remittances. According to the report, in India and the Philippines, 40% of all remittances are spent on basic necessities like health care.

Green Jobs And Industrial Policy

According to the report, based on statistics from the International Renewable Energy Agency, there were 16.6 million green jobs globally, with India holding 1.3 million green jobs.t added that targeted industrial policies, including India’s production-linked incentive schemes, have supported domestic manufacturing in sectors such as solar modules and batteries.

The United Nations report indicates that while domestic demand and services continue to support India’s growth, external factors such as trade restrictions, FDI trends, and remittance policies remain key variables shaping the economic outlook.