Moody's Ratings has downgraded India's GDP growth forecast for the fiscal year 2026-27 to 6%, a reduction from the previous estimate of 6.8%. The agency attributes this adjustment to the ongoing conflict in West Asia, which is expected to moderate growth momentum and increase inflation risks. The region is crucial for India, supplying about 55% of its crude oil imports and over 90% of its liquefied petroleum gas (LPG). Moody's anticipates inflation to average 4.8% in FY27, significantly higher than the 2.4% recorded in FY26. The report highlights that geopolitical tensions could lead to higher fuel and transport costs, affecting household budgets and food prices due to India's dependency on imported fertilizers. Other economic forecasts, including those from the Organisation for Economic Cooperation and Development (OECD) and EY, also suggest a slowdown in growth and rising inflation. Despite these challenges, Moody's notes that the Indian government’s focus on infrastructure spending may help sustain investment activity. However, elevated energy prices and disruptions in trade are expected to weigh on growth prospects.