NEW DELHI, October 6, 2026 —India’s economy is projected to grow at 7.1% in FY27 supported by robust domestic demand and strong exports, despite global headwinds. It remains one of the fastest-growing major economies in the world and a key contributor to global growth, says the World Bank’s latest economic update.
Released today, the India Development Update notes that medium term prospects are strong but also cautions that external risks are elevated, including downside risks related to global oil prices, el Nino, and stock market corrections that would result in capital flow volatility.
The Update’s special focus, India and Artificial Intelligence: Seizing the Development Opportunity, highlights that India is well positioned to harness AI, thanks to its large technical workforce, globally integrated IT sector, and digital public infrastructure. Private AI investment had a three-fold increase from $1.2 billion in 2024 to $4.1 billion in 2025. At the same time, Global Capability Centers employed 1.9 million professionals in 2024, which grew to 2.36 million professionals in 2025.
The report acknowledges that the long-term economic and labor market impacts of AI remain uncertain. It calls for cross-cutting policy actions to deepen AI-enabling infrastructure and improve the business environment, while broadening AI access and enhancing labor capacity, so that the benefits of AI are broadly shared.
read more: https://www.worldbank.org/en/news/press-release/2026/10/06/india-development-update-oct-2026
