Leading trade association FICCI predicted on Thursday that the year 2024–2025 will see a median GDP growth of 7%. It also stated that the Union Budget for 2024–2025 should prioritize tax changes, creating jobs, innovation, and sustainable development.
The findings of the FICCI’s “Economic Outlook Survey” indicate that median GDP growth in Q1 2024–25 and Q2 2024–25 is projected to be 6.8% and 7.2%, respectively.
According to the poll, the median growth estimate for 2024–2025 for agriculture and related sectors was 3.7%.
“This represents an improvement over the 1.4% increase that was reported in 2023–2024. “Agricultural productivity is expected to benefit from ebbing El Nino effects and an expected normal southwest monsoon,” stated the leading trade association.
On the other hand, growth in the industry and services sectors is predicted to be 6.7% and 7.4%, respectively, in the current fiscal year.
Furthermore, for the period of 2023–2024, the median prediction for CPI-based inflation has been set at 4.5%, with a minimum and maximum range of 4.4% and 5%, respectively.
“While food prices remain sticky with inflation inching up in cereals, fruits and milk, the survey participants expect an easing of prices in the second quarter with kharif output reaching the market,” stated FICCI.
Economists predict that at the end of the fiscal year 2024–25 (March 2025), the policy repo rate will have moderated to 6%.
Regarding spending and fiscal management, the economists in attendance noted that the government has handled the finances skillfully.
Such caution is anticipated to persist as maintaining macroeconomic stability is crucial. Economists believe that the government can obtain more resources through the Reserve Bank of India’s dividend transfer and strong tax collections,” the FICCI poll report stated.
Regarding capital expenditure, it was noted that while there remained room for growth, little was anticipated to deviate from the Rs 11.1 trillion estimate included in the interim budget for FY2025.
The economists who participated in the study anticipated certain tax reforms intended to promote economic expansion.
“Potential revisions in tax rates to boost disposable income and stimulate consumption, particularly for lower income brackets, is anticipated,” they stated.
It was also proposed that raising the limitations under Section 80C and other such laws may promote long-term investment and savings. The research also stated that a framework for streamlining GST slabs and simplifying the capital gains tax regime are anticipated.
The experts stated that extensive measures to increase employment and improve workforce capacities are anticipated to be introduced in the upcoming budget.
The surveyed economists highlighted several recommendations, including the introduction of an employment-linked incentive scheme, the creation of an urban counterpart to the Mahatma Gandhi National Rural Employment Guarantee Act, increased investments in soft infrastructure and labor skilling programs, and the implementation of targeted policies and support systems to increase female labor force participation.
