New Delhi, Oct 23 Deloitte India on Thursday raised its forecast for India’s GDP growth by 0.3 percentage points to 6.8 per cent for the financial year 2025-26 amid buoyant demand and policy reforms undertaken by the government.
The increase in the growth forecast comes on the back of a robust 7.8 per cent growth posted by the Indian economy in the first quarter of the current fiscal year.
"This performance signals not just resilience but a renewed sense of India emerging stronger than most nations. Similar growth rates are expected in the subsequent year, but the range of variation remains broader due to uncertainties associated with trade and investment," Deloitte’s India Economic Outlook report states.
Growth is likely to be supported by buoyant domestic demand, accommodative monetary policy, and structural reforms, such as GST 2.0. Low inflation is also expected to contribute to spending as purchasing power improves, the report added.
The increase in Deloitte’s growth forecast comes close on the heels of the RBI raising its projection for India’s economic growth to 6.8 per cent.
Deloitte India Economist Rumki Majumdar said demand during the festive quarter will likely be fuelled by a notable rise in consumption spending. This is expected to be followed by strong private investment, as businesses respond to uncertainties and prepare to meet elevated demand.
"There is also anticipation that India will strike a deal with the US and the EU by the end of the year, which is expected to elevate overall investment sentiments. Strong growth in the first and third quarters is likely to drive overall annual growth," Majumdar observed.
A strong rural consumer confidence index (above 100) indicates optimism in rural demand, and improved crop output will support farm income in the coming months, the report further stated.
However, growth in the current fiscal year remains vulnerable to global headwinds. Escalating trade uncertainties and India's inability to secure a trade deal with the United States are potential risks that could impact India's economic growth, the report added.
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