India’s Economy Expected to Grow at 6.8-7% in Q4 FY25
The Indian economy is projected to grow at 6.8-7% in the fourth quarter of the financial year 2024-25, driven primarily by the agriculture sector. According to a Bank of Baroda report, the agriculture sector is expected to register a robust growth of 7.7% in Q4 FY25, significantly higher than the 0.9% growth in Q4 FY24, thanks to record foodgrain production.
Key Highlights:
- Agriculture Sector: Expected to grow at 7.7% in Q4 FY25, driven by record foodgrain production
- Manufacturing Sector: Likely to slow down to 1.8% growth in Q4 FY25 due to unfavorable base and weaker corporate earnings
- Construction Sector: Expected to grow at a solid pace, supported by improved steel and cement output
- Services Sector: Mixed trend visible, with trade, hotels, and transport sector expected to expand by 6.4% in Q4 FY25
Growth Outlook for FY26:
The report projects India’s economy to grow at 6.4-6.6% in FY26, driven by:
- Monetary Easing: Lower interest rates to boost economic growth
- Lower Inflation: Expected to provide a cushion to growth
- Sound Domestic Demand: Supported by budgetary push and sustained capex spending
- Rural Demand: Likely to continue upward momentum due to favorable monsoon expectations
However, potential risks to growth include geopolitical conflicts, global tariff imposition, and extreme weather conditions. Despite these challenges, India’s economy is expected to remain one of the fastest-growing large economies, supported by strong macroeconomic fundamentals
