Key facts
- Goldman Sachs lowered India's 2026 current account deficit forecast to 1.3% of GDP.
- Goldman Sachs previously forecast India's 2026 current account deficit at 2% of GDP.
- Goldman Sachs projects a balance of payments surplus for India in 2026.
- Factors contributing to the revised forecast include strong remittances, robust services exports, and reduced oil imports.
- S&P Global reports India is adjusting fiscal policy to support domestic growth.
- India's fiscal policy shift is a response to rising global uncertainties.
- The West Asia conflict is cited as a specific global risk influencing India's policy.
- India is implementing long-term strategies to manage energy and food costs.
- The fiscal policy aims to enhance economic stability.
Goldman Sachs has updated its economic projections for India, significantly lowering its forecast for the country's current account deficit (CAD) in 2026. The new estimate stands at 1.3% of GDP, a notable reduction from the firm's prior projection of 2%. This downward revision is supported by several key factors, including strong inflows from remittances, continued robust performance in services exports, and an expectation of reduced oil imports. Consequently, Goldman Sachs anticipates a balance of payments surplus for India in 2026.
In parallel, S&P Global has observed a strategic shift in India's fiscal policy. The nation is reportedly adjusting its approach to bolster domestic growth and enhance economic resilience in the face of escalating global uncertainties. A primary driver for this policy adjustment is the ongoing conflict in West Asia, which contributes to a more volatile international economic landscape. S&P Global's report indicates that India is moving towards implementing long-term strategies aimed at effectively managing energy and food costs.