New Delhi | The finance ministry on Friday said with an uptick in private investment and inflation trending down, India's outlook for the next fiscal looks positive.
The Monthly Economic Review also said that inclusion of Indian bonds in Bloomberg bond index from January 2025 should bolster inflows.
It said robust investment activity is driving growth amid a steady rise in consumption.
"The continued focus on public investment seems to have crowded in private investment," said the February edition of the review by Department of Economic Affairs.
The National Statistical Office (NSO) has revised upwards the GDP growth estimate for current fiscal to 7.6 per cent from 7.3 per cent.
India grew above 8 per cent for three consecutive quarters, reaffirming its position as a standout performer amid sluggish global growth trends. Various agencies echo a similar sentiment revising the FY24 growth estimates of India closer to 8 per cent, the ministry said.
"On the whole, India looks positively towards the dawn of FY25," the review said.
It said increased demand for residential properties in tier-2 and tier-3 cities augurs well for furthering construction activity.
Non-farm employment has revived, improving the capacity to absorb the labour leaving agriculture.
"The ascent of manufacturing sector employment is expected to be marked by upscaling of enterprises and sunrise sectors emerging as catalysts for generating quality employment," it added.
It said strong growth accompanied by stable inflation and external account and progressive employment outlook will help the Indian economy close the current financial year on a positive note.
"There are headwinds like indications of hardening crude oil prices and global supply chain bottlenecks to trade. Nonetheless, India, on the whole, looks forward to a bright outlook for FY25," the monthly review said.
It said India's inflation outlook for the upcoming months is positive.
Core inflation is trending downwards, indicating a broad-based moderation in price pressures. The pick-up in summer sowing is likely to help reduce food prices, it added.