India’s GDP growth unlikely to exceed 6.5% in near term: RBI MPC member

India may not achieve GDP growth beyond 6.5% in the near term, owing to the current external environment, a Reserve Bank of India (RBI) policy committee member has said.

"Obviously, we should aim for growth higher than 6.5%. This might not be achievable in the near term given the current external environment, but the government has been working hard to push the reforms envelope, fiscal policy has certainly done significant heavy lifting,” Informist quoted Saugata Bhattacharya, external member of the RBI MPC, as saying.

His remarks come against the backdrop of steep tariffs imposed by the United States on Indian goods.

On August 27, Washington enforced President Donald Trump’s additional 25% tariff hike on Indian imports, doubling cumulative levies to 50%, among the highest on any major economy’s products.

The RBI, at its latest monetary policy meeting, left its real GDP growth projection for 2025-26 unchanged at 6.5% despite heightened global uncertainties.

The central bank expects growth of 6.5% in the April-June quarter of FY26, 6.7% in July-September, 6.6% in October-December, and 6.3% in January-March. For 2026-27, the growth projection stands at 6.6%.

The central bank also kept its key policy rate unchanged after cutting it by 100 basis points since February, as it weighed risks arising from tariff-related uncertainties.

RBI Governor Sanjay Malhotra this week reiterated that the monetary authority remains focused on supporting growth while maintaining its primary mandate of price stability.

“The primary objective of monetary policy in terms of price stability has significantly contributed to the strength of India’s macro fundamentals,” Malhotra said at the inaugural session of FIBAC 202. “At the same time, monetary policy has not lost sight of its objective of growth,” he added.

Malhotra said the RBI is examining measures to expand bank credit, including to sunrise sectors.

“We might seem to be on opposite sides, with the regulated entities trying to accelerate growth and the regulators focusing on stability, but we actually have the same objectives... a shared vision of a Vikshit Bharat,” he said.

Meanwhile, the government is exploring steps to boost domestic demand, including an overhaul of the goods and services tax to spur consumer spending.