The Indian economy is well-positioned to handle the ongoing oil shock and West Asia tensions, with GDP growth projected at 6.8 to 7% in Financial Year ’27, according to State Bank of India (SBI) Research. The report said India enters the current phase of global uncertainty from a position of strength, supported by robust macroeconomic fundamentals, with Financial Year ’26 growth at 7.6%. Inflation is seen at about 4.5%, while the fiscal deficit is projected at 4.5  to 4.6%. It flagged risks such as a possible El Niño, which could impact economic activity, but also said the banking sector remains stable. 

 

The report also pointed out challenges from the West Asia conflict that have created multiple vortexes of headwinds for sectors like agriculture, MSMEs and supply chains, while highlighting opportunities for India in global value chains and financial services.