The Indian economy could grow between 7-7.2 per cent in the current fiscal on strong government spending, and higher manufacturing investments, Deloitte India said on Tuesday.
It added that however, a tempered global growth will impact the outlook for the next fiscal.
The thriving manufacturing sector, stable oil prices, and potential US monetary easing post-elections may boost India’s capital inflows, reduce production costs, and enhance long-term investments and job opportunities, Deloitte said in its ‘India Economy Outlook for October 2024′.
Deloitte India retains its annual GDP growth projection to be between 7 per cent and 7.2 per cent in FY 2024-2025 and between 6.5 per cent and 6.8 per cent the following year, it said.
“Domestic factors such as moderating inflation, especially in food, better rainfall and record Kharif production, stronger government spending in the second half of the year, and rising investment in manufacturing will help in India’s growth this year.”
Deloitte in its report said job creation in the economy is key to ensuring a steady household income, and the latest employment data points to some green shoots.
“India will need more formal and quality jobs to ensure better income distribution. The emphasis on manufacturing and the rise in emerging industries, such as semiconductors and electronics that require advanced education and specialised skills will create more high-quality jobs,” it added.
India’s push toward clean-energy alternatives is set to generate green jobs across various sectors, including energy, agriculture, tourism, and transport. Besides, India’s greatest strength, its young, aspiring population — positions it to gain rapid and substantial returns from the government’s recent efforts in skill development, Deloitte added.
It said the MGNREGA scheme provides temporary jobs to employ people who have limited or no alternate stable income opportunities. For the first time since the pandemic, the scheme’s 12-month moving average ’employment demanded’ number has fallen below pre-pandemic levels in August 2024.