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India has the potential to grow at over 7.5 per cent, Reserve Bank of India Governor Shaktikanta Das said at an international forum in Singapore on Friday. This estimate is slightly higher than the 7.2 per cent growth rate reported by the Reserve Bank of India for the current financial year-FY25. The event was organised in Singapore with the help of Swiss bank UBS, the Reserve Bank of India said.
Balancing risks in growth rate forecasting
Shaktikanta Das said, growth forecast risks are balanced and supported by strong fundamentals. The main drivers are private consumption and investment.
The RBI Governor said that inflation has come down from a high of 7.8 percent in April 2022 to around the target of four percent. But we still have to work hard and need to pay attention to it.
The Reserve Bank of India has projected the inflation rate to come down to 4.5 percent for this financial year. Along with this, the average inflation rate is expected to come down to 4.1 percent in the next financial year. Provided that the monsoon remains normal and there is no external or policy shock.
RBI Governor Shaktikanta Das said services exports have rebounded, but apparel export growth has been lower than expected due to weak external demand. He points to progress in fiscal consolidation, reduction in public debt and improving corporate performance as positive indicators for balanced growth.