India's GDP Growth Forecast Revised to 7.5%

India Ratings & Research (Ind-Ra) has raised its GDP growth forecast for FY25 to 7.5%, citing improved consumption demand, driven by government spending and fiscal measures targeting rural and MSME development. Similarly, the National Council of Applied Economic Research (NCAER) anticipates that the economy could grow above 7%, potentially reaching 7.5%, with strong indicators such as increasing PMI for manufacturing and services, along with a rise in bank credit. The favorable outlook is bolstered by a projected above-normal monsoon and a reduction in electoral uncertainties. The Union Budget for 2024-25 emphasizes fiscal prudence with a deficit target of 4.9% of GDP and aims to enhance capital expenditure. Both the IMF and ADB have projected India's growth at around 7%, while the NCAER's Business Confidence Index indicates a positive sentiment among businesses. Overall, the Indian economy appears set for robust growth, supported by stable consumption and investment dynamics.