S&P Global Ratings on Wednesday raised India’s GDP growth to 7.1 per cent in the fiscal year ending in March 2027, compared with 7.6 per cent in fiscal 2026.The key drivers of GDP growth are resilient private consumption, a modest recovery in private investment and solid exports, the rating agency said in a report.“But downside risks prevail, primarily due to the renewed geopolitical tensions and persistent trade-related uncertainties. These risks could affect India through fluctuations in commodity prices, trade volumes, and capital flows,” the report added.Inflation in India will rise to 4.3 per cent in fiscal 2027 as it normalises from low levels, the report said.“Higher crude prices will likely widen the trade deficit, but a healthy surplus in services trade should help contain the current account deficit. Overall, we expect the central bank to hold rates steady and maintain a neutral stance,” it said.The report highlighted that the global growth will mostly hold up even in the face of war. Global activity has derived support from strong AI-related investment spending on tech products, especially in the US, and accommodative fiscal and monetary policy in several major economies.But as the Middle East turmoil continues, so will the negative impact, the report said. “Our baseline forecast assumes that the Strait of Hormuz will face material disruptions until early April, with flows recovering gradually thereafter. The baseline includes significant but generally manageable economic impact.,” it stated.Higher energy prices are raising costs and inflation and eroding purchasing power, thus depressing growth. In some economies, shortages of liquified gas and government measures to save energy consumption disrupt economic activity.Longer disruption will heighten the economic damage. “Our energy market downside scenario considers more economic impact as energy supply from the Middle East remains constrained for longer,” it explained.