India's Economy Poised for 6.5% Growth in FY25 Despite Geopolitical Headwinds: CII President

Resilient Foundation, Investment Momentum, and Domestic Demand to Drive Growth​

New Delhi, May 11 – India’s economy is projected to grow at 6.5% in the current fiscal year (FY25), with strong fundamentals and increasing investments offsetting the temporary drag of global geopolitical tensions, according to Confederation of Indian Industry (CII) President Sanjiv Puri.

In a recent interview, Puri expressed confidence in the country's ability to maintain robust growth, attributing this to a resilient macroeconomic foundation and a surge in both public and private sector investments.

“We are looking at 6.5 per cent. We believe this number can be achieved fundamentally because we are starting with a reasonably good foundation,” he said.

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Key Growth Drivers: Investment, Policy Support, and Inflation Control​

Puri highlighted multiple positive indicators:

• Interest rates have eased
• Inflation is becoming benign
• Personal income tax concessions that came into effect on April 1
• Strong investment momentum in sectors such as energy, transportation, metals, chemicals, and hospitality

These developments, he noted, have created a solid platform for growth, despite the cautious sentiment that may result from geopolitical uncertainties.

Rising Trade Protectionism: Need for Strategic Bilateral Agreements​

Addressing the global trend of rising trade barriers, including proposed high tariffs by US President Donald Trump, Puri stressed the importance of India pursuing bilateral trade agreements.

“More and more barriers to trade are coming in right now. Therefore, the countries that India is pursuing, especially the US and EU, are important,” he said.

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He urged that such agreements be framed strictly from a national interest perspective, and proposed a three-tier tariff architecture to boost India’s trade competitiveness.

Focus on Domestic Growth Engines​

To ensure sustained economic progress, Puri advocated for a deeper focus on agriculture reform, climate adaptation, and domestic competitiveness. He also suggested that further easing of interest rates could be expected.

On consumption trends, he observed:

• Rural demand is showing signs of revival
• Urban demand remains flat but is expected to improve in the coming quarters

Conclusion​

As India navigates a complex global environment, the CII president’s outlook remains optimistic. With sound economic policies, active pursuit of trade agreements, and strong internal demand, the Indian economy appears well-positioned to meet its FY25 growth target of 6.5%.