India on 6.8% growth path to upper-middle income by 2031

According to a report released by ratings agency Crisil on Wednesday, the Indian economy is anticipated to grow at a rate of 6.8% in the next fiscal year, slightly below the forecast of 7% made by the central bank.

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The report attributes this slight downturn to higher interest rates and lower fiscal impulse, which could dampen demand in the South Asian nation.

Crisil further projected that by fiscal year 2030-31 (FY31), India’s economy would approach the significant milestone of $7 trillion. This growth trajectory, with an average annual growth rate of 6.7%, would position India as an upper-middle-income country within the next seven years.

In classifying economies, the World Bank defines upper middle-income countries as those with a Gross National Income (GNI) per capita ranging from $4,256 to $13,205. India’s per-capita income stood at ₹98,374, or $1,183, in FY23, according to the latest government data.

Despite the growth forecast for FY25 falling slightly below the RBI’s projection, Crisil affirmed that India would maintain its position as the world’s fastest-growing major economy. The agency attributed the projected lower fiscal impulse to the necessity of reducing the fiscal deficit to 5.1% of GDP in the next fiscal year.