New Delhi [India], June 24 : S&P Global has revised its Gross Domestic Product (GDP) growth forecasts for India upwards for both 2025 and 2026, citing resilient domestic demand as a key driver.

In its latest research note, the company now anticipates India's GDP to grow by 6.5 per cent year-on-year in 2025 and 6.7 per cent in 2026, up 0.2 percentage points from its previous projections for both years.

However, the note emphasizes that forecast assumes a normal monsoon, lower crude oil prices, income-tax concessions and monetary easing.

The report also shows that inflation has generally receded even as sequential core inflation has risen in India in recent months, along with other South-Asian nations like Indonesia and Malaysia.

Additionally, "In India, falling food inflation also helps contain headline inflation. Across the region, redirection of exports away from the U.S. will weigh on price increases," the report said.

The report noted that resilient domestic demand limits the slowdown in the Asia-Pacific region.

S&P Global sees China's GDP growth to be 4.3 per cent in 2025 and 4.0 per cent in 2026, and the resilient domestic demand should contain the economic slowdown due to U.S. tariffs hitting China's exports.

In the other Asia Pacific region, South Korea's GDP shrank sequentially in the first quarter to a level lower than a year ago amid struggling domestic demand and political uncertainty.

In Japan the economy also contracted a bit and Australia's growth remained low. "Higher uncertainty, subdued income growth, and elevated cost of living pressures have dampened domestic demand in these countries," S&P Global said.