Deloitte projects India’s FY25 GDP growth at 6.6%.
Deloitte India forecasts India's GDP growth at 6.6% for FY 2024-25, citing consumption, exports, and capital flows.
Deloitte India announced on Friday its forecast of India's GDP growth at 6.6 percent for the current fiscal year, driven by factors such as increased consumption expenditure, a rebound in exports, and capital inflows. In its report on India's economic outlook, Deloitte highlighted the rapid expansion of the middle-income class, leading to greater purchasing power and heightened demand for premium luxury goods and services. Anticipating a significant rise in the number of middle-to-high-income households by 2030/31, Deloitte expects this trend to further fuel overall private consumer spending growth.
Deloitte has revised its economic growth projection for the previous fiscal year to a range of 7.6 to 7.8 percent, compared to its earlier forecast of 6.9 to 7.2 percent for the 2023-24 fiscal year. Looking ahead, Deloitte predicts India's GDP growth to reach approximately 6.6 percent in FY 2024-25 and 6.75 percent in the following year, as markets factor in geopolitical uncertainties affecting investment and consumption decisions. Deloitte's quarterly update on its economic outlook suggests a synchronized global economic rebound in 2025, driven by resolving major election uncertainties and potential rate cuts by Western central banks in late 2024.
Deloitte India Economist Rumki Majumdar emphasized the role of strong growth figures over the past two years in aligning the economy with pre-COVID trends. She highlighted the contribution of investment, supported by robust government spending on infrastructure, in maintaining a steady recovery momentum. However, concerns persist regarding inflation and geopolitical uncertainties, which could lead to higher food and fuel prices. The prediction of above-normal monsoon rainfall offers some relief by positively impacting agricultural output and alleviating pressure on food prices.
Majumdar expects inflation to remain above the Reserve Bank of India's target level of 4 percent due to robust economic activity. Deloitte's GDP growth estimate for FY25 aligns with projections by the World Bank but falls short of those by the RBI and other agencies. While the Asian Development Bank (ADB) and Fitch Ratings estimate growth at 7 percent, the International Monetary Fund (IMF), S&P Global Ratings, and Morgan Stanley anticipate a growth rate of 6.8 percent for FY25.
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