The Indian economy is expected to grow by 7.1-7.3% in the current fiscal, with a sustained revival in private investment providing an additional source of demand, Deloitte India said on Friday.
However, geopolitical tensions, volatile energy prices and trade disruptions pose risks to the growth outlook, it added.
Deloitte India Economist Rumki Majumdar said over the past decade, India's growth has rested on resilient household spending and sustained investment push in public infrastructure. Businesses now have better connectivity, healthier balance sheets, and higher capacity utilisation, which strengthens the case for expansion.
"The question is whether these conditions will encourage private investment to play a larger role in boosting growth in the coming years. Recent indicators offer grounds for optimism. Gross fixed capital formation grew by 11.9 per cent in the first quarter of FY 2026-27, its fastest expansion in four years," Majumdar said.
Deloitte Economic Outlook projected India's economy to grow by 7.1-7.3% in FY 2026-27 and 6.6-7.0% in FY 2027-28.
A sustained revival of private investment would provide India an additional source of demand while building the productive capacity needed for future growth. Geopolitical tensions, energy-price volatility, and trade disruptions remain risks to this outlook, the report said.
Deloitte's FY27 GDP growth projection compares with 7.1% estimated by the RBI and OECD, 7% by the International Monetary Fund (IMF), ADB, S&P Global Ratings and Moody's.
Majumdar said a shift towards investment in strategic sectors such as semiconductors, electronics, defence manufacturing, clean energy, and AI infrastructure will add to the private capex momentum since these sectors require substantial upfront investment.
"India has improved many of the business conditions needed to expand. Turning those improvements into sustained private investment now depends on how confidently firms can plan, finance, and execute their next projects," she added.