India is poised for “improved prosperity” as the reforms initiated by the new government are taking shape and sectors, including infrastructure, will be the key drivers of growth, says global consultancy Deloitte.
Riding on the back of economic reforms and demographic dividend, Deloitte today said that Information and Communication technology, BFSI (Banking, financial services and insurance), Retail as well as Infrastructure and Construction are among the sectors which are poised to drive growth in the country over the next 30 years.
According to the latest competitiveness report by Deloitte, with a new government in place, solid growth projected, and a flourishing middle class, “investors appear increasingly willing to back India”.
“India is poised for improved prosperity as new government reforms begin to take shape,” Deloitte Global Managing Director for Industries Gary Coleman said.
“To fully realise its potential, India must continue to invest in infrastructure, particularly transport networks and power systems, as well as work to enhance the employability of its working population,” he added.
According to the report, infrastructure and construction sector is forecasted to become the world’s third-largest construction market by 2025.
“With the government’s three-pronged strategy aimed at modifying the regulatory framework, removing bottlenecks for existing projects, and reviving the capital-expenditure cycle, India could lead growth among emerging economies in the infrastructure and construction sector,” the report said.
“However, rapid economic growth and a rising population have placed immense pressure on India’s infrastructure in the near term,” it added.
It also noted that government’s strategy to promote financial inclusion in India, along with the country’s rising middle class is likely to drive up the BFSI industry.
Similary, rising incomes, growing middle class and young population, brand conscious consumers, technological advancements, among others would strengthen the retail sector, the report said.
For the information and communication technology sector, the report noted that with economic expansion, IT spending by both businesses and consumers is likely to increase.
“This will aid the wider ICT sector, which will also benefit from greater penetration of computing technology, smartphones, and the Internet in both urban and rural areas,” it added.
Deloitte India senior director Anis Chakravarty said: “As policies start to take shape, it will be critical to take advantage of the demographic dividend, not just through the creation of jobs and employment, but also by developing a clear roadmap to navigate tough economic reforms”.
Automobile and Pharmaceuticals would be other key sectors to drive growth, the consultancy said.