India can return to 7% growth by FY28 despite near-term risks, says CEA Nageswaran

India can return to a growth trajectory of over 7% in FY28 through macroeconomic stability and supply-side measures, provided external conditions improve, Chief Economic Adviser V Anantha Nageswaran said on Friday.

The comments came after the Reserve Bank of India lowered its GDP growth forecast for FY27 to 6.6% from 6.9% projected in April, citing elevated energy and commodity prices and continuing supply disruptions linked to the West Asia conflict.

"We have no reason to second-guess them (RBI forecast) at this point, because there are both possibilities on the upside and on the downside with respect to the numbers that they have presented," Nageswaran said, PTI quoted.

"So, even if the growth were to slip below 7 per cent as the RBI forecast suggests...macro stability measures and supply assurances will bring us back to a 7 per cent plus growth track in FY28 or as soon as external conditions improve," he added.

Nageswaran said the outlook is based on the assumption that conditions prevailing before February 28 are restored before FY28.

"Now, if these conditions continue, then we will revisit the estimate for the next financial year," he said.

The CEA also said nominal GDP growth is likely to exceed the 10.1% estimate used in the Union Budget for 2026-27, supported by the upward momentum in retail inflation.

"The good news is that the nominal GDP growth will be significantly higher than the number which the budget estimates used, which is 10.1 per cent for the current financial year," he said.


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