By 2026, India will be just two places behind the US and China, becoming the world's third largest market.:

News Topical, Digital Desk : With its current growth rate, India will become the world's third-largest consumer market ( India consumer market 2026 ) after the US and China in 2026 and the third-largest economy by 2028. According to a UBS report, "India's household consumption has nearly doubled over the past decade to reach $2.4 trillion in 2024, registering a compounded growth rate of 7.9 percent, higher than China, the US and Germany."

The report said that due to favourable policies and strong domestic demand, India's real GDP growth is expected to stabilize at 6.4 percent year-on-year in fiscal year 2027 and 6.5 percent in fiscal year 2028. It will remain the fastest-growing economy in the Asia-Pacific region in 2027. India will be followed by the Philippines (GDP growth of 6.1 percent) and Indonesia at 5.1 percent.

In the United States, GDP growth is expected to slow from 1.9 percent in 2025 to 1.7 percent in 2026 and improve to 1.9 percent in 2027. Real GDP growth in China is expected to slow to 4.5 percent in 2026 (from 4.9 percent in 2025). The economy is expected to be impacted by a decline in exports.

However, UBS has maintained downside risks to India's growth forecast due to uncertainty surrounding US trade policy and India's policy response.

The report also said that a 25 percent tax on payments made by US companies to foreign outsourcing services could reduce India's growth rate by about 90 basis points in fiscal year 2027. The report also expects the RBI to cut rates by another 25 basis points during the current fiscal year ending March 31, 2026, to boost growth.