RBI's growth forecast optimistic: Economists

Most peg next fiscal’s growth at around 6.5%

- PRIYANSH VERMA

AMID WEAK PRIVATE consumption and uncertainty of a pick-up in private investments, economists say that the Reserve Bank of India's (RBI) assumption of a 7% GDP growth in FY25 seems "optimistic".

Most economists have pegged next year's growth around 6.5%.

In the current financial year, India's GDP is expected to grow at 7.3%, according to the first advance estimates of the National Statistical Office (NSO).

Sudipto Mundle, chairman at Centre for Development Studies, said that the private investment cycle has not yet kicked in, which poses a major downside risk to growth next year.

"Also, so far, public capex has been driving domestic growth, but for FY25, the interim Budget has raised its outlay by a modest amount...so, it may not support growth as much as it did this year," he said. Mundle sees growth around 6.5% in FY25.

The interim Budget has pegged the Centre's capital expenditure target for the next fiscal at 11.1 trillion, up 17% from the revised estimate of 9.5 trillion for FY24.