India’s economy is projected to become the fourth largest globally by 2026, surpassing Japan, with a growth rate of 6.8% in FY25 and 7.7% in FY26, according to PHD Chamber of Commerce and Industry (PHDCCI). The industry body attributes this growth to the nation’s resilient economy and strong macroeconomic fundamentals. It advocates for increasing the income tax exemption limit to Rs. 10 lakh (US$ 11,566.03) and adjusting the peak income tax rate to apply only to incomes above Rs, 40 lakh (US$ 46264.11) to boost disposable income and consumption. It also expects the Reserve Bank of India (RBI) to reduce the benchmark interest rate by 25 basis points due to falling Consumer Price Index (CPI) inflation.
It suggests a five-pronged strategy to accelerate growth, including higher capital expenditure, improved ease of doing business, reduced business costs, a focus on labour-intensive manufacturing, and deeper integration into global value chains. It highlights that India’s growth has been driven by proactive government reforms and an attractive investment climate, setting it apart from other global economies facing slower growth. It also emphasizes the need for a focus on key sectors such as agriculture, fintech, semiconductor manufacturing, renewable energy, health, and insurance to sustain future growth.
Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.