india-sees-7-pc-growth-in-fy25-despite-headwinds-deloitte

India remains a bright spot in an otherwise gloomy global economic landscape, with the potential to achieve a 7% growth rate in the current fiscal year, according to Romal Shetty, CEO of Deloitte South Asia. 

Shetty, the youngest chief executive of a Big Four accounting and consultancy firm in India, noted that inflation is reasonably controlled, rural demand is picking up, and vehicle sales are improving. "We believe that we would be in the 7-7.1% range in terms of growth this fiscal year," he said.

However, he acknowledged that global headwinds, including geopolitical crises in the Middle East and Ukraine and a slowdown in the western economies, could impact India's GDP growth.

Deloitte projects that India's growth rate will decline slightly to 6.7% in the next fiscal year (2025-26). The Indian economy grew by 8.2% in the previous fiscal year (2023-24).

In an interview with PTI, Shetty expressed confidence that the Modi 3.0 government will maintain its pace of economic reforms, including privatisation, and that there is significant momentum to achieve goals within government departments. He highlighted India's status as the world's fifth-largest economy, predicting it will expand to USD 5 trillion and become the third-largest economy within this decade.

Shetty also noted that the recent decline in oil prices could benefit India, given its status as a net importer. He indicated that a US Federal Reserve rate cut would have positive implications for the Indian economy.

Looking ahead, Shetty believes India can become the "services capital of the world" and emphasised the importance of leveraging technology in agriculture to boost productivity. He suggested that India should focus on niche areas where it can excel globally.

When asked about India's aspirations to achieve developed nation status by 2047, Shetty pointed out that per capita income must rise from the current USD 2,500 to USD 20,000. He argued that reaching a per capita income of USD 5,000 would significantly boost domestic consumption and make the economy more self-reliant.