In an interview with The Economic Times, economic affairs secretary Shaktikanta Das seemed to be rather optimistic by stating that growth will be close to 8%. This despite taking into account external factors such as Brexit and its impact on Britain and the European Union.
The International Monetary Fund, or IMF, recently trimmed its India growth forecast by 0.1% to 7.4% in FY17-FY18 on slack investment recovery, even as it lowered global economic growth projections owing to downside risks from Brexit. Even though the IMF noted that economic activity remains buoyant, the growth forecast for 2016-17 was trimmed reflecting a more sluggish investment recovery.
According to a Deutsche Bank report, the Indian economy is expected to grow 7.5% this financial year.
Economic fundamentals of the country continue to lag with growth indicators such as PMI, industrial production, non-oil-non-gold imports, either remaining flat or recording a sequential slowdown in April-June compared to the January-March levels. On the other hand, inflation pressure has increased considerably in the second quarter of this year.
Deutsche Bank’s growth forecast for this fiscal is 7.5%; for 2017-18, the growth forecast post Brexit is 7.6% (down from 7.8%), factoring in increased uncertainty and weaker global growth in the medium term.
However, according to DBS, India's young population will be an advantage for its economic growth as the country's GDP is likely to improve at 7.9% for the year 2017-18, from 7.8% in the current year. Their projection seems more in line with that of the economic affairs secretary.
