India could hit $5.1 trillion by FY29, says OmniScience Capital
The investment firm projects nominal GDP growth of 8% annually in US dollar terms, assuming 6.5% real growth, 4% inflation and 2.5% rupee depreciation per year
India's economy may surpass $5.1 trillion by FY29, according to an analysis by OmniScience Capital. The firm projects a base case scenario of 8% nominal GDP growth annually, with 6.5% real growth, 4% inflation, and 2.5% annual rupee depreciation. If growth accelerates to 7% and the rupee depreciates by 2% yearly, the economy could reach $5.9 trillion by FY29 and $11 trillion by FY35.
The current GDP of $4.1 trillion in FY26 represents a nominal CAGR of just 5.4% since FY19, falling short of the 10.2% annual growth required to meet the original $5 trillion target set by the government in FY26. The shortfall is attributed to a 4.15% GDP contraction in FY21 during the pandemic, twin balance-sheet stress for banks and corporates, and a 12.3% rupee depreciation against the US dollar in FY26 alone.
OmniScience Capital sees more favorable conditions emerging, with real GDP growth averaging 7.4% between FY22 and FY26, outpacing the 6.2% average of the previous two decades. Bank and corporate balance sheets are at their healthiest in 20 years, potentially marking a turning point for sustained growth.
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