India Watch: India growth meter – Visible resiliency

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India Watch: India growth meter – Visible resiliency

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India Watch

India growth meter – Visible resiliency

Economic resiliency visible through poly crises 02 July 2026

As the Iran conflict de-escalates, India’s economic resiliency has been on display, with GEM Economics

high frequency indicators for May and early indicators from June coming in reasonably Asia | India

strong. Indeed, with energy prices now drifting lower, we believe the negative effects of

the terms of trade shock will start to fade, further strengthening the momentum. Still, RahulIndia &BajoriaASEAN Economist

because of higher input prices, some sectors will likely show a lingering impact of the BofAS India

+91 22 6632 3095

conflict, even though inflation risks have receded somewhat. The next risk on the horizon rahul.bajoria@bofa.com

is from a sub-par monsoon, which in the month of June was 40% below normal, the Smriti Mehra

worst start we have seen since 2009, when India experienced its last drought. India Economist

BofAS India

May data held up, June data shows improvement +91smriti.mehra@bofa.com22 6632 8314

In May, economic data held up strongly in services side, with fuel consumption still holding

up despite persistence of supply constraints, while banking credit growth, and trade related

Glossary

indicators are holding up well. Industrial production too improved, growing over 5% yoy in

FY: Financial Year (April to March)May, and should remain supported in June as well. The weakness was concentrated in

travel, but May incrementally was better than April, as aviation networks improved, but H2FY: Financial Year latter half (October-

LPG consumption where supply disruptions have been high, remain impacted, but may March)

recover going forward.