FICCI cuts India's GDP growth estimate to 6.4% for FY25

New Delhi: Industry body FICCI lowered India's gross domestic product (GDP) growth projection to 6.4% in 2024-25 from 7% earlier on Thursday. "The numbers are in line with the broad expectation and reflect a notable slowdown in regard to 8.2% GDP growth recorded in 2023-24," according to the Economic Outlook Survey by Federation of Indian Chambers of Commerce & Industry (FICCI).

The agriculture, industry and services sector will expand by 3.6%, 6.3% and 7.3%, respectively, the survey noted.

Inflation is projected at 4.8% for 2024-25, in line with the Reserve Bank of India's projection in the latest monetary policy meeting in December 2024.


The survey was conducted in December covering responses from leading economists across industry, banking and financial services sector.

With Donald Trump taking office as the US president on January 20, economists expect short-term disruptions through channels like exports, foreign capital flows, and input costs for the US trading partners including India.

Eonomists expect the budget to adhere to fiscal consolidation, targeting a fiscal deficit of 4.5% of GDP. An increase in capital expenditure of 10-15% is also expected, they noted.

Reviving private consumption is a key priority and a review of the current tax structure and rates is called along with an increase in disposable income. Investments should continue in welfare programmes like Mahatma Gandhi National Rural Employment Guarantee Act, Pradhan Mantri Awaz Yojana, and Pradhan Mantri Gram Sadak Yojana, according to economists.

Further, the budget is expected to prioritise manufacturing through sector-specific incentives, rationalised tax rates, and development of high-quality industrial clusters.

On exports, economists believe continuation of interest equalisation scheme could be helpful to extend support to exporters.

"India's economic outlook for 2025 reflects cautious optimism, amidst the backdrop of persisting external headwinds," the survey noted.