GDP Growth of 6.8–7.2% In FY27 Achievable But Delay In US FTA Still Pose a Risk: Deloitte India

New Delhi, Jan 30 (KNN) India’s GDP growth projection of 6.8–7.2 per cent for FY27, as outlined in the Economic Survey, is achievable given the country’s economic resilience, but delays in finalising a free trade agreement (FTA) with the United States could pose a significant risk, according to Deloitte India Economist Rumki Majumdar.

She said the Survey’s growth estimate is more optimistic than projections by multilateral agencies such as the IMF and World Bank, but reflects strong domestic momentum that has continued despite global uncertainty.

Domestic Drivers Support Growth

Majumdar noted that India’s recent economic performance has exceeded expectations, including near 8 per cent growth in the first half of the current fiscal year. She attributed this resilience to rising domestic demand, sustained public capital expenditure, and cumulative policy reforms, reported PTI.

According to her, the growth momentum is supported by government measures such as tax reforms, a more accommodative monetary policy stance, and structural changes including the implementation of labour reforms.

US FTA Seen as Key Vulnerability

Despite the positive outlook, Majumdar flagged the pace of negotiations on the India–US FTA as a major uncertainty. 

"I think one of the biggest risks would be how quickly India can sign the FTA with the US. While it's good that India is diversifying... the US remains our largest trading partner," she said.

Services account for around 55–56 per cent of India’s GDP, and any disruption affecting access to the US market could have a material impact on overall growth, she warned.

Currency Concerns and Trade Impact

Majumdar also highlighted concerns over the rupee’s depreciation, pointing to a disconnect between currency movements and India’s economic fundamentals. 

She noted that despite a low current account deficit, historically low inflation, and a reduced fiscal deficit of 4.4 per cent, the rupee has continued to weaken, partly due to foreign institutional investor (FII) outflows.

She cautioned that sharp currency depreciation could offset gains from trade agreements, particularly where tariff concessions are involved.

(KNN Bureau)