Page 4 - Policy Economic Report - Feb 2026

POLICY AND ECONOMIC REPORT
OIL & GAS MARKET

Executive Summary

According to World Bank, global growth is estimated to have averaged 2.7 percent in 2025, 0.4 percentage
point above June projections, in part because of stronger than-expected growth in major economies. The
growth is forecast to edge down to 2.6 percent in 2026, driven by a notable slowdown in demand for
traded goods and softening domestic demand in many major economies. It is then set to pick up slightly
to 2.7 percent in 2027, as domestic demand benefits from earlier monetary policy easing and trade
improves amid declining uncertainty.

After remaining at 1.7 percent in 2025, growth in advanced economies is expected to edge down to 1.6
percent this year, as the effects of higher trade barriers weigh on activity, and remain at that pace in 2027.

Growth in Emerging Market and Developing Economies (EMDEs) was stronger than expected in 2025, at
an estimated 4.2 percent. Activity in China proved more robust than anticipated, mostly on account of
fiscal stimulus and increased shipments to non-U.S. markets. Growth in EMDEs is forecast to decelerate
to an average of 4 percent in 2026–27, as the projected slowdown in China is partly offset by a gradual
pickup in other EMDEs next year.

In case of India, highlights of first Advance Estimates of Gross Domestic Product, 2025-26 are given below:-

• Real GDP has been estimated to grow by 7.4% in FY 2025-26 against the growth rate
of 6.5% during FY 2024-25.

• Nominal GDP is estimated to grow at 8.0% in FY 2025-26.

• Buoyant Growth in Services Sector has been found to be a major driver in the estimated Real GVA
growth rate of 7.3% in FY 2025-26.

• Financial, Real Estate & Professional Services and Public Administration, Defence & Other
Services in the Tertiary Sector have been estimated to attain a substantial growth rate of 9.9% at
Constant Prices in FY 2025-26.

• Trade, Hotels, Transport, Communication & Services related to Broadcasting Sector has been
estimated to grow by 7.5% at Constant Prices in FY 2025-26.

• Manufacturing and Construction in the Secondary Sector has been estimated to achieve a growth
rate of 7.0% at Constant Prices in FY 2025-26.

• Agriculture & Allied Sector (3.1%) and Electricity, Gas, Water Supply & Other Utility Services
Sector (2.1%) have seen moderate growth rate in GVA at Constant Prices during FY 2025-26.

• Real Private Final Consumption Expenditure (PFCE) has been estimated to attain a growth rate
of 7.0% during FY 2025-26.

• Gross Fixed Capital Formation (GFCF) has been estimated to have 7.8% growth rate at Constant
Prices during FY 2025-26, compared to 7.1% growth rate in previous FY.

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