The brokerage believes overall growth will remain relatively resilient despite constraints on manufacturing and services. Supportive factors include “the Goldilocks starting conditions,” lagged impact of policy easing, and easing trade tensions with the United States, it said.
Further, it noted that the government has introduced targeted measures, such as fuel tax cuts, logistical support for exporters, and potential credit guarantees for micro, small and medium enterprises (MSMEs).
Gross domestic product (GDP) growth is projected to moderate to 6.3-6.7% in H1FY27, before rising to 7.1-7.2% in the second half, according to Nomura.
India’s FY26 GDP growth is expected at 7.6%, as per official estimates.
Nomura cautioned that prolonged disruptions due to the Iran conflict could have a larger, non-linear impact, and persistently high oil prices are increasing losses for oil companies. Although fuel price hikes are currently on hold, any increase after the state elections could add to inflation and weigh on growth.
The conflict could impact the Indian economy through multiple channels, Nomura said.