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Key Points

S&P Global predicts India's GDP will grow at 6.8% annually over the next three years, driven by strong infrastructure investments and fiscal discipline. The agency highlights India's outperformance compared to other emerging markets despite global economic challenges. Improved monetary policies and inflation control have created a more stable economic environment. Public infrastructure spending is set to rise significantly, supporting long-term growth.

Key Points: India GDP to Grow 6.8% Annually Next 3 Years Says S&P Global

  • S&P forecasts 6.8% annual GDP growth for India over next 3 years
  • Infrastructure spending to hit 5.5% of GDP with state and central investments
  • Inflation control and monetary reforms stabilizing economic conditions
  • India outperforms emerging market peers despite global slowdown
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India's GDP projected to increase 6.8 pc annually over next 3 years: S&P Global

S&P Global projects India's GDP growth at 6.8% annually, citing infrastructure push and fiscal reforms as key drivers of economic expansion.

"We forecast India's real GDP growth at 6.5% this year, which compares favorably with emerging market peers amid a global slowdown – S&P Global"

New Delhi, Aug 14

India remains among the best-performing economies in the world, and "we expect growth dynamics to continue in the medium term", with GDP increasing 6.8 per cent annually over the next three years, S&P Global said on Thursday.

New Delhi, Aug 14 (IANS) India remains among the best-performing economies in the world, and "we expect growth dynamics to continue in the medium term", with GDP increasing 6.8 per cent annually over the next three years, S&P Global said on Thursday. India is prioritising fiscal consolidation, demonstrating the government's political commitment to deliver sustainable public finances, while maintaining its strong infrastructure drive.

"We forecast India's real GDP growth at 6.5 per cent this year, which compares favourably with emerging market peers amid a broad global slowdown," the global ratings agency said in a note.

"Robust economic expansion is having a constructive effect on India's credit metrics, and we expect sound economic fundamentals to underpin growth momentum over the next two to three years. In addition, monetary policy settings have become increasingly conducive to managing inflationary expectations," it noted.

The quality of government spending has improved in the past five to six years. The current administration has increasingly shifted budget allocation to infrastructure spending. Capital expenditure (capex) of the Union government is scheduled to increase to Indian rupees (INR) 11.2 trillion, or about 3.1 per cent of GDP, in fiscal 2026, it said.

This is up from the 2 per cent of GDP from a decade before. Adding capital spending by states, total public investment in infrastructure is estimated at around 5.5 per cent of GDP, which is on par or higher than sovereign peers.

"We believe the improvements in infrastructure and connectivity in India will remove chokepoints, which are hindering long-term economic growth," said the global ratings agency.

Monetary policy reform to switch to inflation targeting has reaped dividends. Inflationary expectations are better anchored than they were a decade ago. Between 2008 and 2014, India's inflation reached double-digits on numerous occasions.

In the past three years, despite volatility in global energy prices and supply-side shocks, CPI growth averaged 5.5 per cent. In recent months, it stayed at the lower bound of the Reserve Bank of India's (RBI) target range of 2 per cent-6 per cent.

These developments, coupled with a deep domestic capital market, reflect a more stable and supportive environment for monetary settings.

- IANS

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Reader Comments

S
Shreya B
As someone working in manufacturing sector, I can see the positive impact of infrastructure spending. Our logistics costs have reduced by 15% in last 2 years. Keep it up! 🇮🇳
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Arjun K
While the numbers look impressive, we must ensure this growth is inclusive. Rural areas still lag behind in basic facilities. Hope the government allocates more funds for healthcare and education in villages.
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Priya S
The inflation control is really commendable! As a homemaker, I've noticed prices stabilizing compared to 5 years ago. RBI is doing good work managing the economy 👏
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Vikram M
With global slowdown affecting many countries, India's consistent growth is remarkable. But we must be careful about rising debt levels - fiscal consolidation is key for long-term stability.
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Kavya N
The focus on infrastructure is visible everywhere - new highways, metro projects, airports. But can we also improve the quality of existing infrastructure? Many roads need maintenance.
M
Michael C
As an investor in Indian markets, this gives me confidence. India's domestic consumption story combined with infrastructure push makes it an attractive destination for long-term investments.

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