A government report says India's economy will grow more than 8 percent in the upcoming financial year and appears to have shaken off its persistent problems of high inflation, rising budget deficits and poor domestic demand.

The Economic Survey, an annual report on the state of Asia's third-largest economy, said Friday that India appeared to have hit an economic "sweet spot" and was ready for "big bang reforms."

The growth projections would make India the world's fastest growing economy, surpassing China. However the higher growth projections follow a revision of the baseline against which India calculated economic growth.

According to the new calculations India's economy is likely to grow 7.4 percent in the current financial year.