ICRA Projects India's Economic Surge: A 2025-26 Financial Forecast
The leading ratings agency ICRA forecasts that India's GDP growth will exceed 6.5% by the 2025-26 financial year, despite tepid merchandise exports and inflationary pressures. The government is expected to boost capital expenditure by 10.1%, while rural demand and household incomes will likely rise due to favorable policies.
- Country:
- India
According to ICRA's latest projections, India's GDP growth is expected to climb above 6.5% in the 2025-26 financial year. This positive outlook comes alongside a forecasted GVA growth of over 6.3% for the same period.
The agency anticipates that the Consumer Price Index will surpass 4.2% and the Wholesale Price Index will rise above 2.7% for the current fiscal year, highlighting continued inflationary pressures. The fiscal deficit is expected to reach 4.4% of GDP, with the current account deficit projected at -1%.
ICRA suggests rural demand will benefit from Rabi cash flows and bountiful reservoir levels, while fiscal measures like income tax relief and interest rate cuts aim to increase household disposable incomes. Although merchandise exports remain sluggish, services exports are poised to grow. Government capital expenditure is set to increase by 10.1%, aiming to invigorate investment activity.
(With inputs from agencies.)
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