New Delhi, Nov 15
The Indian economy is expected to clock a medium-term growth of 6.7 per cent on average between fiscal 2025 and 2031, and touch the $7 trillion mark, according to a report by rating agency CRISIL.
This would be similar to the 6.6 per cent growth seen in the pre-pandemic decade, driven by a capex push and surge in productivity.
The report projects India's Gross Domestic Product (GDP) growth at 6.8 per cent during the current financial year as high interest rates and stricter lending norms are expected to impact urban demand.
"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.
"Although kharif sowing is higher this year, the impact of excess and unseasonal rains needs to be ascertained. An adverse weather event through the rest of this fiscal remains a constant risk to food inflation and agriculture income," the report states.