New Delhi: India’s economic trajectory is poised for sustained growth, with a projected medium-term expansion of 6.7% annually between fiscal years 2025 and 2031. This optimistic forecast, outlined by the esteemed rating agency CRISIL, positions India on the brink of achieving a $7 trillion economy. This growth rate mirrors the robust 6.6% expansion witnessed in the decade preceding the pandemic.
The primary drivers of this anticipated growth are a concerted push towards capital expenditure and a significant surge in productivity. Government initiatives aimed at infrastructure development, coupled with private sector investments, are expected to fuel economic activity. A robust manufacturing sector, driven by initiatives like “Make in India,” will further contribute to the growth momentum.
“A somewhat lower fiscal impulse to growth (as the Central government pursues fiscal consolidation) should also weigh on growth,” the ET-Crisil India Progress Report states.
Inflation based on the Consumer Price Index (CPI) is likely to ease to 4.5 per cent on average in 2024-25 from 5.4 per cent in the previous year, driven by lower food inflation. However, the report sees weather conditions and geopolitical uncertainties as key risks to its growth and inflation forecasts.
According to the report, “any further escalation in geopolitical tensions could constrain supply chains, disturb trade and push up oil prices, impacting inflation and sending input costs soaring.”
Join our whatsapp group for Latest updates