The Confederation of Indian Industry, or CII expects the Indian economy to grow by 8 percent in fiscal 2024-25 on the back of the sectors like agriculture making a strong comeback and with the spurt in private investments, said Sanjiv Puri who was elected as the new President of CII and Chairman of ITC.
Puri stated that the agricultural sector, which was worst hit because of erratic weather conditions last year, will be making a smart comeback helped by normal monsoon forecast, which will boost rural consumption and thereby economic growth.
CII's forecast growth rate has come at a time when India's central bank, the Reserve Bank of India, has also revised its GDP growth rate to 7.2% in its recent revision.
"The projected growth is crucially dependent on pending reforms taking the topmost priority, propitious and encouraging global trade prospects increasing exports, investment, and consumption having done well, and expectations of a normal monsoon, assured Puri in the CII statement.
CII's projections peg agricultural growth at 3.7% in FY25 from 1.4% in FY24. It forecasts industrial sector growth at 8.4% from 9.3% last year and services growth at 9% from 7.9% in the year ending March.
Speaking of growth drivers, he emphasized six growth drivers through which impetus is being given to the economy: increased investment by the private sector, larger public investment in physical and digital infrastructure, a strongly capitalized banking system, booming capital markets, reduced reliance on oil, and strong contribution by sectors that have benefitted from government incentives.
Puri said that, along with the private sector being at the forefront of the growth momentum in India, solid investment in infrastructures, digital developments, besides a stable banking system and booming capital markets, put India on its growth track.
The CII business confidence survey for January-March 2024 was upbeat, with three-fourths of the respondents expecting a private capital expenditure increase in the current fiscal's first half over the previous year.
Private sector's gross fixed capital formation-a measure of investment in plant and machinery-was pegged at 23.8 percent of nominal GDP in FY23, which is better than the pre-pandemic level witnessed in FY19 and FY20.
Sectors like Cement, steel, electronics, food processing, telecom and logistics, renewable energy, automobiles, semiconductors these are all verticals where levels of private investments are basically on the growth path only because of this set of initiatives by the government through the production-linked incentives, Puri said.
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