India's GDP to Grow by 6.4% in FY25: FICCI Report Sector-wise, the survey anticipates agriculture and allied activities to grow at 3.6 per cent, industry at 6.3 per cent, and services at a robust 7.3 per cent

India's economic landscape for the fiscal year 2024-25 is projected to maintain a steady growth trajectory, bolstered by robust government initiatives and a revival in consumption, according to the latest Economic Outlook Survey released by the Federation of Indian Chambers of Commerce & Industry (FICCI). The survey estimates a median GDP growth of 6.4 per cent for the year, signaling cautious optimism despite persisting global headwinds and domestic challenges.

The first half of the fiscal year witnessed a modest growth rate of six per cent, with projections for the latter half showing an uptick to 6.8 per cent, driven by factors such as increased public capital expenditure, festive demand, and post-monsoon normalization in industrial activity. Sector-wise, the survey anticipates agriculture and allied activities to grow at 3.6 per cent, industry at 6.3 per cent, and services at a robust 7.3 per cent.

Inflation, a critical determinant of economic stability, is expected to moderate, with the Consumer Price Index (CPI) projected at a median of 4.8 per cent for the year. Economists believe this could ease the strain on household budgets, particularly benefiting low and middle-income families, while supporting urban consumption recovery. The repo rate is expected to settle at 6.25 per cent by the fiscal year's end.

Key drivers of growth

The survey highlights government-led capital expenditure as a cornerstone of economic momentum. Investments in infrastructure—spanning roads, railways, housing, and logistics—are anticipated to deliver strong multiplier effects, fostering job creation and industrial growth. The revival of rural consumption, supported by improved agricultural prospects and easing food inflation, is also expected to boost demand in the economy's heartland.

Services, particularly in hospitality, real estate, health, and education, remain poised for expansion, with potential for significant capacity creation. However, private sector investments are forecasted to remain subdued, hampered by geopolitical uncertainties, uneven domestic demand, and competitive pressures from global players like China. No

Budget 2025-26

As the Union Budget approaches, stakeholders are calling for bold measures to stimulate growth and address structural challenges. Recommendations include revising tax structures to boost disposable income, enhancing welfare programs like MGNREGA and PMAY, and increasing capital expenditure by 10-15 per cent to sustain infrastructure development. Special emphasis is placed on agricultural reforms along with climate-proofing initiatives and strengthening supply chains to reduce inflationary pressures.

The manufacturing and MSME sectors require urgent reforms in land, labor, and financial regulations to improve competitiveness. Additionally, sustainable finance and green initiatives are expected to take center stage, with proposals for carbon capture technologies, circular economy frameworks, and climate risk mitigation programs.