India Ratings jacks up growth forecast to 7.5% this fiscal

New Delhi: Citing the ongoing growth momentum led by government capex, deleveraged balance sheets of corporate robust quality banks’ assets, and a likely revival in private corporate capex, India Ratings has upped its growth forecast for the current fiscal to 7.5 percent—the highest among all analysts and 30 bps over the Reserve Bank estimate.

The agency had previously projected a 7.1 percent uptick in the GDP, which has surprisingly grew at 8.2 percent in FY24. At 7.2 percent, the Reserve Bank forecast is the highest from the official estimates, which was revised up by 20 bps from its April forecast, while the budget has pegged it at 6.5-7 percent.

Pegging higher growth at 7.5 percent for this fiscal, the agency in a report Wednesday said the Budget promises to bolster agricultural/rural spending, improve credit delivery to MSMEs and incentivise employment creation in the economy.

The agency believe these measures would help in broad-basing consumption demand which if not addressed can constrain the ongoing growth momentum.