New Delhi, Feb. 5 -- S&P Global Ratings has expressed optimism about India's economic trajectory following the 2025-26 Budget announcement, citing income tax reductions for households as a key driver of domestic demand growth.

In its latest assessment released on February 4, 2025, the rating agency marginally lowered its growth forecast for 2024-25 to 6.7 per cent from 6.8 per cent, while raising its 2025-26 projection to 6.8 per cent from 6.7 per cent.

The agency maintains confidence in India's ability to achieve its fiscal deficit targets of 4.8 per cent of GDP for the current year and 4.4 per cent for 2025-26, despite potential revenue impacts from tax concessions and moderated economic growth.

These shortfalls could be offset by su...