ICRA Insight

October 2025

Foreword

We are pleased to present the October 2025 edition of ICRA Insights, continuing our commitment to delivering timely, research-backed perspectives on India’s evolving macro and sectoral landscape.

This month’s Monthly Macro Wrap features updated forecasts from our Chief Economist, Aditi Nayar. With GST rationalisation and festive momentum, India’s real GDP growth for FY2026 is now projected at 6.8%. The CPI inflation is expected to ease to 2.6%, and the RBI’s dovish stance hints at potential rate cuts. Tariff concerns persist, especially for services exports.

In our Spotlight on CSR, we highlight our CSR activity: Meals, Moments, and Meaningful Connections, wherein ICRA Bengaluru celebrated pre-Navratri with VIDYA CoE students.

The Research Recap covers GST reforms, the Business Activity Monitor, and the Indian tractor industry. Key themes include festive consumption boosts, IIP growth and market shifts due to emission norms.

This edition also features webinar details, rating updates, methodologies, media coverage, and our latest podcast on data centres and ICRA's Climate Series. We hope you find this edition insightful and engaging.

K. Ravichandran

Chief Ratings Officer, ICRA Limited.

Aditi Nayar

Chief Economist, ICRA Limited.

Monthly Macro Wrap

ICRA’s Chief Economist Aditi Nayar shares insights on India’s economy this month. While tariff concerns loom over services exports, the GST rationalisation brought festive cheer with reduced rates. Transient production-demand shifts may cause data blips. The RBI’s dovish pause hints at possible rate cuts, with the inflation forecast lowered to 2.6% and GDP growth revised to 6.8%. Tune in for more!

Listen to the podcast

Spotlight
on CSR

Meals, Moments, Meaningful Connections

ICRA Bengaluru celebrated pre-Navratri with VIDYA CoE students, sharing meals, laughter, and stories. This heartfelt CSR event reflected our commitment to equality, education, and the spirit of community. Click here to know more!

Research Recap

GST Rationalisation

The GST rationalisation has been a timely move to boost festive consumption, merging key slabs and lowering the average rate. While the revenue foregone may prompt fiscal adjustments, the CPI inflation could ease, supporting ICRA’s upgraded FY2026 GDP growth forecast of 6.5%.

ICRA Business Activity Monitor

ICRA’s Business Activity Monitor rose to a 5-month high of 8.3% in August 2025, led by coal and steel output. Despite the mixed trends and US penalties, ICRA expects the IIP growth at ~5.5%.

Indian Tractor Industry

The TREM V norms may raise tractor prices by 15-20% for less than 50 HP models, driving market consolidation in the 41-50 HP segment. This segment could capture 65-70% share as buyers shift from lower and niche higher HP categories.