India Economic Perspectives "Macro on the ground – policymakers' views" ...

Research evidence excerpt

India Economic Perspectives "Macro on the ground – policymakers' views" ...

Global Research

17 June 2026ab

India Economic Perspectives Economics

IndiaMacro on the ground – policymakers' views

Tanvee Gupta Jain

Economist

On-the-ground sentiment somewhat cautious tanvee.guptajain@ubs.com

+91-22-6155 6070

During our recent meetings with government officials, a former RBI official, economists

and journalists, the overall mood appeared somewhat cautious. Despite repeated

external shocks – including higher trade tariffs, geopolitical disruptions and emerging El

Niño risks – alongside elevated global uncertainty, the broad view was that India’s

growth has remained resilient. They expect India's FY27 real GDP growth at 6.5-7% YoY

(vs. 7.7% YoY last year), with inflation broadly foreseen near 5% YoY. Policymakers

highlighted that India’s economic strategy remains guided by three key pillars: 1)

maintaining macroeconomic stability; 2) advancing structural reform; and 3) identifying

and addressing sectoral vulnerabilities. The government was hopeful that recent trade

agreements (including with the UK and EU) will support India’s manufacturing push.

There is also an expectation that a US-India trade agreement could be concluded this

year. While the 2020 PLI scheme helped India gain share in electronics manufacturing,

the benefits have not significantly broadened across other sectors. Among policy-

makers, there is a thinking of a next phase of PLI, especially to deepen manufacturing.

India has managed the energy shock well

Despite India’s high exposure to external energy shocks, the near-term supply situation

appears manageable, aided by the country's large refining capacity, diversified supply

sources and active policy buffers, which have cushioned the initial shock. Our