FICCI estimates 7% GDP upsurge for India in 2024-25, expects repo rates to be reduced by the end of the financial year

The latest FICCI Economic Outlook survey conducted in July 2024 projects India’s GDP to grow at an average rate of 7.0% for FY2025, with estimates ranging from 6.6% to 7.5%. Despite ongoing challenges, India remains one of the world’s fastest growing economies, driven by insights from leading economists from the industry, banking and financial services sectors.
The survey estimates a significant improvement in agriculture and allied activities, with a growth rate of 3.7% compared to 1.4% in the previous financial year. Factors such as end of El Nino effect and prediction of normal monsoon by IMD are expected to stabilize Kharif crop production.
The growth rates of industry and services sectors are expected to be 6.7% and 7.4% respectively, down from 9.5% and 7.6% in the last financial year. Strong investment is forecast and supported by government capital spending and increased private investment.
Improvement in the agricultural sector and moderation in inflation are sure to improve private consumption. Inflation projections indicate a CPI-based forecast of 4.5% for 2024-25, which is in line with the RBI’s monetary policy stance. The policy repo rate is projected to soften to 6% by the end of the fiscal year, reflecting a cautious outlook amid inflation concerns.