Amid the global economic slowdown, India continues to stand out as a beacon of growth. Deloitte South Asia’s CEO, Romal Shetty, has expressed confidence that the Indian economy will expand at a rapid pace, projecting a 7% growth rate for the current financial year (2024-25). This optimistic outlook comes despite the global recession, geopolitical tensions, and other economic headwinds.
According to Shetty, inflation in India is under control, rural demand is on the rise, and vehicle sales are picking up. He attributes these factors to India’s resilience in the face of worldwide economic challenges. “While the global scenario remains gloomy, India is performing better than many other economies,” Shetty stated.
Global Factors Impacting India’s Growth
Although India’s growth prospects remain strong, the country is not completely isolated from global events. The ongoing conflicts in Ukraine and West Asia, coupled with a slowdown in Western economies, may have a moderate impact on India’s GDP growth. Deloitte’s estimates suggest that India’s growth rate could slow to 6.7% in the next financial year (2025-26), down from the 8.2% recorded in 2023-24.
Despite these challenges, Shetty believes that India’s economic outlook remains robust. He anticipates that the government under Prime Minister Narendra Modi will continue its economic reforms, including privatization efforts, which are crucial for long-term growth.
India on Track to Become the Third Largest Economy
India, currently the world’s fifth-largest economy, is well on its way to becoming the third-largest by the end of this decade. The country’s economy is expected to reach a valuation of $5 trillion, bolstered by favorable factors such as falling crude oil prices and potential interest rate cuts by the US Federal Reserve. Lower oil prices benefit India, a net importer, helping to manage inflation and reduce the trade deficit.
Shetty further emphasized India’s potential to become a global leader in the service sector. He highlighted the need for technological advancements in agriculture to boost productivity. By leveraging technology, India can secure its place as a global player in specific industries, further strengthening its position on the world stage.
India’s economic resilience, coupled with favorable domestic policies and global market conditions, continues to push the nation forward, even as the rest of the world grapples with economic uncertainty.
