India's GDP likely to grow 7.1-7.3 pc in FY27 on private investment revival

New Delhi: India is likely to maintain its position as one of the fastest-growing major economies, with GDP growth projected at 7.1-7.3 per cent in the current fiscal year, driven by a revival in private investment and continued strength in domestic demand, according to Deloitte India on Friday.

In its latest Economic Outlook, Deloitte said the country's growth over the past decade has largely been supported by resilient household consumption and sustained public infrastructure spending.

The report noted that improving business conditions, stronger corporate balance sheets, better connectivity, and rising capacity utilisation are now creating a favourable environment for private-sector investment to play a larger role in driving economic expansion.

Deloitte India Economist Rumki Majumdar said recent economic indicators point towards growing momentum in private investment activity. Gross fixed capital formation expanded by 11.9 per cent in the first quarter of FY27, marking its fastest growth in four years and signalling increasing confidence among businesses.

The report projected India's economy to grow between 7.1 and 7.3 per cent in FY27, followed by growth of 6.6-7.0 per cent in FY28. A sustained pickup in private capital expenditure is expected to provide an additional source of demand while also enhancing the country's productive capacity for long-term growth.

According to Deloitte, investment in strategic sectors such as semiconductors, electronics, defence manufacturing, clean energy and artificial intelligence infrastructure could further strengthen the private capex cycle, as these industries require significant upfront investments and offer long-term growth opportunities.

However, the report cautioned that geopolitical tensions, volatility in global energy prices and disruptions in international trade remain key risks to the economic outlook and could impact growth prospects if they intensify.

Deloitte's growth forecast for FY27 is broadly in line with estimates from several global and domestic institutions. The Reserve Bank of India (RBI) and the Organisation for Economic Co-operation and Development (OECD) have projected growth of 7.1 per cent, while the International Monetary Fund (IMF), Asian Development Bank (ADB), S&P Global Ratings and Moody's have forecast growth of around 7 per cent.

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