India's Steady Growth Amid Global Trade Challenges: Deloitte Report

Deloitte projects India's economy to grow at 6.6% in FY2025-26, highlighting a balance between domestic tax incentives and global trade uncertainties. Despite moderation due to election-related uncertainties and trade issues, strong domestic demand supports resilience, with decisive US-India trade negotiations being pivotal in determining future growth dynamics.

India's economic growth is forecasted to retain a steady pace at 6.6% for the fiscal year 2025-26, according to a recent report by the global consulting firm Deloitte. The outlook highlights the balancing act India faces, between leveraging domestic tax stimuli and navigating challenging global trade conditions.

Deloitte indicates that while the trade uncertainties present risks, India's economy has shown resilience, slowing only to 6.1% year-on-year till the third quarter of FY2025, partly due to factors like electoral uncertainty, weather anomalies, and volatile trade landscapes. However, strong domestic demand led to a significant 9.2% growth in FY2023-24.

Key indicators such as GST collections, automobile, and FMCG sales have been strong, further evidencing economic momentum. The Union Budget 2025 introduces tax cuts aimed at boosting consumer spending. Nonetheless, looming trade tensions, especially the high tariffs with the US, are critical, with ongoing negotiations expected to play a decisive role in shaping India's economic future.

(With inputs from agencies.)