In view of reforms, better investment climate, improved ease of doing business and a normal monsoon so far, the Indian economy is expected to grow 7.5 percent in 2016-17 (FY17), global consultant Dun & Bradstreet said on Wednesday.
"The sweeping reforms to rules on foreign direct investment, the clearance of bankruptcy code, GST, debt recovery bill etc. heralds a better investment climate and improved ease of doing business in India going forward.
"In view of these positive developments and a normal monsoon so far, we expect India’s economic growth as measured by GVA (Gross value added) at basic prices to grow by 7.5 percent in FY17 as against 7.2 percent in the previous fiscal," said Arun Singh, Lead Economist, Dun & Bradstreet India.
India is poised to curve its growth story driven by several steps taken by the government to unshackle constraints to growth.
He said the Indian economy is expected to witness consumption-led growth in FY17 driven by low global crude oil prices, good agriculture production, measures taken by the government to uplift rural demand and the 7th Pay Commission payouts.
Singh, however, mentioned the stressed assets in the banking sector, non-revival in corporate investment and declining India’s export could drag overall growth going forward.
The firm projected private final consumption expenditure (PFCE) is expected to gain strength and grow by 12.6 percent at current prices in FY17 while WPI inflation is likely to return to positive territory to 3.5 percent in the current fiscal.
Bank credit is to increase by 10.5 percent in FY17 as against 10.9 percent in FY16. The firm said investment rate likely to increase marginally to 35.4 percent in the current fiscal while savings rate is expected to remain almost flat at 33.9 percent during this fiscal.