India’s economy is poised for a strong rebound, with the Confederation of Indian Industry (CII) projecting a growth of 6.8% in the current fiscal year (FY24) and an acceleration to 7% in the subsequent fiscal year (FY25). CII attributes this optimistic outlook to the government’s unwavering commitment to infrastructure development and the facilitation of ease of doing business.
CII President R Dinesh, also the Executive Vice Chairman of TVS Supply Chain Solutions, shares insights into the growth projections in an interview with PTI.
Initial Estimate Surpassed: The CII’s initial estimate of 6.5-6.7% growth has been surpassed, with the current expectation set at 6.8% for the ongoing fiscal year.
Conservative Outlook: Dinesh emphasizes the conservative nature of the projection, citing the robust growth of 7.7% recorded in the first half of FY24, ending in September.
Factors Driving Growth
CII President highlights key factors contributing to the anticipated economic upswing.
Government’s Infrastructure Focus: The sustained emphasis on infrastructure development by the government is identified as a major catalyst for economic growth.
Ease of Doing Business Initiatives: Initiatives aimed at promoting ease of doing business are expected to foster a favorable environment for economic activities.
Capacity Utilization and Investment Confidence
Insights into current economic dynamics and business sentiments.
High Capacity Utilization: Presently, the economy boasts 75% to 95% capacity utilization across various sectors, a trend observed over the last three quarters.
- Upcoming Investments: Anticipation of increased private sector investments in the second half of the fiscal year, as revealed by a CII membership survey.
Positive Business Sentiment: Survey findings indicate a majority of CII members expressing optimism about higher private sector investments in H2 compared to H1.
Important Questions Related to Exams
Q: What is CII’s revised GDP growth forecast for India in FY24?
A: CII predicts 6.8%, exceeding the initial estimate of 6.5-6.7%.
Q: What influenced the upward revision?
A: Strong H1 FY24 performance with 7.7% growth and increased private sector investments.
Q: What’s the outlook for FY25?
A: CII anticipates further acceleration to 7%, citing government focus on infrastructure and ease of doing business.