India expected to mark 7% growth amid headwinds this fiscal: Deloitte Asia CEO

India is expected to clock a 7 per cent growth in financial 2024-25 despite the headwinds as the country continues to hold the bright spot in a gloomy global outlook, reported the news agency PTI quoting Romal Shetty, Deloitte South Asia Chief Executive Officer (CEO) on Sunday, September 22.

The youngest CEO of a Big Four accounting and consultancy firm in India, Shetty, said that inflation is reasonably under control, and there has been a pick-up in rural demand. Shetty also highlighted that vehicle sales are also improving in the country, according to the agency report.

“We believe that we would be in the 7-7.1 per cent range in terms of the growth (this fiscal year). You have got the headwinds, the tailwinds... But the fact is, still India is in a better position, in spite of whatever is happening globally, but we can't say we're decoupled from the world,” said Romal Shetty, Deloitte South Asia CEO, quoted by the agency.

Shetty said that the geopolitical crisis in the Middle East and Ukraine and the slowdown in the western economies will impact India's GDP growth, as per the agency report.

Deloitte has estimated that the growth is likely to be 6.7 per cent in the next financial year, 2025-26. The Indian economy grew 8.2 per cent in the previous financial year 2023-24, according to the report.

Shetty's government expectations:

Shetty expects the Modi 3.0 government to continue with the economic reforms, which include privatisation, at the same pace amid a tremendous push to get things done within the government departments, said the executive in an interview with the agency, according to the report.

India, being the fifth largest economy, is poised to expand to $5 trillion and become the third largest within this decade. Falling oil prices in some sense is good for India as the country is the net importer, as well as the US Federal Reserve (FED) rate cut, will be positive for the country, according to the agency report.

As India is the services capital of the world, Shetty highlighted that the nation has to focus on technology in agriculture to increase productivity and also find niche areas where India can dominate globally, as per the report.

India to become a developed nation by 2047, the per capita income has to increase to $20,000, compared to $2,500 currently, said Shetty, if the per capita income rises above a certain level, then the economy also grows at a rapid pace, as per the agency report.

“My own belief is that when the per capita income moves to USD 5,000, you will see much more buying happening. So the shape of the economy, the domestic economy itself, will also change. It becomes more self-reliant as well...,” said Shetty, reported the news agency.