Economic Growth

• Finance Minister Nirmala Sitharaman stated that India is expected to maintain an economic growth rate of 7% or higher for the 2026-27 financial year. • This projection comes despite significant global economic uncertainties and ongoing supply chain disruptions that could impact international trade. • The forecast highlights India's resilience and its position as a fast-growing major economy amidst a volatile global financial landscape.

• A report by Bernstein claims that India's current economic growth is being driven by policy distortions rather than pure free-market forces. • The analysis indicates that company earnings, domestic consumption, and asset valuations are increasingly influenced by tax incentives, regulatory interventions, and government transfers. • This trend is significant because it suggests that growth is stemming from artificial supports rather than genuine underlying productivity gains.

• A report by Bernstein warns that India's current economic growth is driven by government policy distortions and tax incentives rather than genuine market forces. • The analysis highlights that Production Linked Incentive (PLI) schemes, which allocated over Rs 287 billion since FY2023, have artificially boosted profitability in the electronics and electric vehicle sectors. • Bernstein argues that celebrating the earnings growth of successful companies while ignoring the losses of those funding the incentives creates a misleading picture of economic health.

• SBI Research reports that India's economy remains resilient despite global challenges, projecting strong growth, rising deposits, and robust corporate performance. • Data for assessment year 2026 shows a significant rise in high-earners, with taxpayers earning ₹100 crore and above increasing 39% to 576, and those earning over ₹1 crore rising 14% to 5.36 lakh. • This growth highlights increasing wealth concentration and corporate strength as the nation approaches its 80th Independence Day.

GDP expanded by 0.4% in three months to June, down from 0.6% in the first quarter, says ONSEconomic growth slowed in the second quarter of the year, as the disruption unleashed by the Iran war began to take its toll, official figures show.The Office for National Statistics (ONS) said GDP expanded by 0.4% in the three months to June, down from 0.6% in the first quarter, in line with City economists’ expectations. Continue reading...

• Singapore has increased its 2026 economic growth forecast to 4.5%-5.5%, up from the previous estimate of 2.0%-4.0%. • This upward revision follows a strong Q2 performance where the economy grew 5.9% year-on-year. • The growth is primarily driven by a surge in AI-related investments and a more resilient global economy despite conflicts in the Middle East.

TUC will urge John Healey to order ‘root and branch’ assessment of watchdog amid claims its forecasts downplay investment benefitsThe TUC is urging the new chancellor, John Healey, to order a “root and branch” review of the Office for Budget Responsibility, claiming the forecaster’s approach holds back investment.With Andy Burnham promising “good growth in every postcode”, the union umbrella body is calling on Healey to use his first budget on 28 October to re-examine the assessments of the watchdog. Continue reading...