India’s growth has exceeded 6% per annum over the seven years to 2019. Growth in recent years has been supported by robust household consumption, stronger investment—particularly in infrastructure—and greater exports. That said, growth has weakened since 2016, in part because of slow income growth. The IMF projects real GDP growth to grow at 7%, or more, in the next five years.
India’s services sector drives economic output, contributing 57% of GDP in 2018. There are now over 8,900 technology start-ups in India in 2019 according to Nasscom; in particular, Fintech and healthcare technology sectors have grown significantly. Favourable population dynamics and improving business conditions, including simplified tax laws bolster the outlook. Advancement in technology and infrastructure to better integrate India’s large consumer market should further support medium term growth.