The Reserve Bank of India (RBI) has projected India’s real GDP growth at 6.9 per cent for 2026–27 despite mounting geopolitical tensions and inflationary risks arising from the conflict in West Asia, according to the central bank’s Annual Report 2025–26 released on Friday.
The report said the Indian economy was expected to remain resilient in 2026–27, although it warned that rising crude oil prices, supply disruptions and global uncertainties could intensify inflationary pressures.
Geopolitical risks had “re-emerged as the dominant drag on global growth in 2026”, the report noted, adding that trade and financial markets were facing heightened risks while global inflation forecasts had been revised upwards due to the West Asia conflict.
The RBI projected Consumer Price Index (CPI) inflation at 4.6 per cent in 2026–27, compared with 2.1 per cent in 2025–26.
With GDP growth estimated at 7.6 per cent in 2025–26, against 7.1 per cent in the previous year, India continued to remain the world’s fastest-growing major economy, the report added.
It also underscored the Centre’s continued fiscal consolidation efforts. In 2025–26, the gross fiscal deficit (GFD) stood at 4.4 per cent of GDP, below the government’s medium-term target of 4.5 per cent.
The Centre has projected the fiscal deficit for 2026–27 at 4.3 per cent of GDP. “GFD is projected at 4.3 per cent of GDP in 2026–27, reflecting the Centre’s continued fiscal consolidation efforts in recent years,” the report said.
Balance sheet expands to Rs 91.97L cr
Meanwhile, the RBI’s balance sheet expanded to Rs 91.97 lakh crore at the end of March 2026, marking a 20.6 per cent year-on-year increase, driven by higher domestic and foreign investments, including gold holdings.
The balance sheet grew by Rs 15.72 lakh crore from Rs 76.25 lakh crore as of March 31, 2025, to Rs 91.97 lakh crore as of March 31, 2026.
On the assets side, gold, foreign investments and domestic investments rose by 44.9 per cent, 63.8 per cent and 7.9 per cent, respectively.
The report stated that revenue increased by 26.4 per cent compared with the previous year, while expenditure surged by 102.4 per cent. The RBI’s total surplus for 2025–26 rose 6.7 per cent to Rs 2.87 lakh crore.
The central bank’s gold holdings increased sharply during the year owing to higher global gold prices and the rupee’s depreciation against the US dollar, the report noted.
It added that currency notes in circulation, revaluation accounts, and deposits remained the principal components of the balance sheet on the liabilities side.
Domestic assets accounted for 29.5 per cent of total assets at the end of March 2026, up from 24.8 per cent a year earlier. The remaining assets comprised foreign currency assets, gold, and loans and advances.
