India’s medium-term growth performance to be 6.2% through FY28, despite NDA’s slimmer majority': Fitch Ratings

Fitch Ratings predicts that despite the National Democratic Alliance's (NDA) narrower majority post-election, India's growth will persist at 7% in FY25. The agency anticipates continued emphasis on infrastructure investment, business environment enhancement, and fiscal consolidation. A\r

lthough the post-election budget may shed light on economic reforms and fiscal plans, the NDA government's focus on public expenditure, digitalization, and improved financial health should bolster private investment. However, the report acknowledges challenges in accelerating private investment. \r

While reforms like labour laws and manufacturing sector advancements are on the agenda, the NDA's weakened mandate may impede their progress. Fiscal metrics remain a concern, with deficit reduction crucial for India's sovereign rating improvement. Despite gradual fiscal consolidation, risks of increased spending post-election exist, potentially impacting deficit targets.