Chief Economic Advisor V. Anantha Nageswaran said on Friday that India’s economy is expected to grow by 6.5-7% in the current fiscal year, despite a 15-month low GDP growth rate of 6.7% in the April-June quarter.
Data from the National Statistical Office (NSO) shows that GDP growth slowed primarily due to a deceleration in farm production, which fell to 2% from 3.7% in the same period last year.
However, Nageswaran noted that most regions have experienced normal rainfall, with kharif sowing exceeding last year’s levels.
He expressed optimism that the agriculture sector will rebound as the year progresses, bolstered by stable rural consumption and a positive monsoon outlook.
Nageswaran attributed the first quarter slowdown to election-related factors and reduced government spending, but highlighted robust progress in monsoon conditions and healthy corporate and bank balance sheets.
The budget’s focus on employment, skills development, agriculture, MSMEs, and energy security is expected to sustain economic momentum. Nageswaran remains confident that India can achieve 6.5-7% growth, potentially exceeding 7% if structural reforms continue.
He also cautioned about global financial market volatility and potential inflationary pressures, though he noted that overall inflation expectations remain below last year’s levels.
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