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India's economy grew by 7.4% in the March 2025 quarter, slowing from 8.4% a year ago, with annual FY25 growth moderating to 6.5%, according to NSO data.

India's GDP grows 7.4 pc in March quarter, 6.5 pc in FY25

India's economy grew by 7.4% in the March 2025 quarter, slowing from 8.4% a year ago, with annual FY25 growth moderating to 6.5%, according to NSO data.

India's economic growth slowed to 7.4 per cent in the March quarter, bringing down the annual growth rate to 6.5 per cent during 2024-25, according to official data released on Friday.
The growth in the January-March period was lower than the 8.4 per cent expansion in the year-ago quarter.
According to the data released by the National Statistics Office (NSO), the economy expanded 6.5 per cent in 2024-25 against a 9.2 per cent growth in 2023-24.
The NSO, in its second advance estimate of national accounts, had pegged the country's growth at 6.5 per cent for 2024-25.
China has registered an economic growth of 5.4 per cent in the first three months of 2025 (January-March 2025).

The Reserve Bank of India (RBI) has revised the GDP growth forecast for 2025-26 to 6.7%, citing strong rabi crop output and an industrial recovery. Inflation is projected to moderate to 4.2%, with risks evenly balanced.

RBI raises GDP growth forecast to 6.7% for 2025-26, inflation expected to ease

The Reserve Bank of India (RBI) has revised the GDP growth forecast for 2025-26 to 6.7%, citing strong rabi crop output and an industrial recovery. Inflation is projected to moderate to 4.2%, with risks evenly balanced.

The Reserve Bank of India (RBI) on Friday revised its real GDP growth forecast for 2025-26 to 6.7%, citing strong rabi crop output and a revival in industrial activity as key factors driving economic expansion.
Additionally, the central bank expects CPI inflation to moderate to 4.4% in the final quarter of the current fiscal year and decline further to 4.2% in 2025-26.
RBI Governor Sanjay Malhotra stated, "Looking ahead, healthy rabi prospects and an expected recovery in industrial activity should support economic growth in 2025-26."
&nbsp;
<blockquote class="twitter-tweet">
<a href="https://twitter.com/hashtag/WATCH?src=hash&amp;ref_src=twsrc%5Etfw">#WATCH</a> | Making a statement on Monetary Policy, RBI Governor Sanjay Malhotra says, "RBI has estimated that real GDP growth for the next year to be at about 6.7%...." (Source - RBI) <a href="https://t.co/SsY1DknMM4">pic.twitter.com/SsY1DknMM4</a>
&mdash; ANI (@ANI) <a href="https://twitter.com/ANI/status/1887726890431209790?ref_src=twsrc%5Etfw">February 7, 2025</a></blockquote>
&nbsp;
&nbsp;
He also emphasized the role of domestic demand in sustaining growth. "Among the key drivers on the demand side, household consumption is expected to remain robust, aided by the tax relief in the Union Budget 2025-26," Malhotra noted.
Regarding investments, he highlighted improving conditions in key sectors. &ldquo;Fixed investment is expected to recover, supported by higher capacity utilization levels, healthy balance sheets of financial institutions and corporates, and the Government&rsquo;s continued emphasis on capital expenditure,&rdquo; Malhotra said during his post-Monetary Policy Committee (MPC) address.
However, he cautioned that global uncertainties and climate risks remain potential threats to economic growth.
<h3>GDP Growth Projection for 2025-26:</h3>
<ul>
<li>Q1: 6.7%</li>
<li>Q2: 7.0%</li>
<li>Q3 &amp; Q4: 6.5% each</li>
<li>Overall Growth: 6.7% (with balanced risks)</li>
</ul>
In December, the RBI had revised its GDP growth forecast to 6.6% from 7.2%, reflecting ongoing global economic challenges.
Malhotra acknowledged that the global economy remains under pressure, even as trade activity shows resilience. He pointed to slower disinflation, geopolitical uncertainties, and policy unpredictability as major hurdles.
Additionally, he highlighted the impact of the strong US dollar on emerging market currencies, including the depreciation of the Indian rupee, stating that the RBI is actively monitoring and stabilizing the currency.
On the domestic front, Malhotra referred to First Advance Estimates, which peg India's real GDP growth at 6.4% for 2024-25, driven by private consumption, a strong services sector, and an agricultural recovery. However, weak industrial growth remains a challenge.
<h3>Inflation Outlook:</h3>
<ul>
<li>2024-25 CPI Inflation Projection: 4.8% (Q4: 4.4%)</li>
<li>2025-26 CPI Inflation Projection: 4.2%</li>
<li>Q1: 4.5%</li>
<li>Q2: 4.0%</li>
<li>Q3: 3.8%</li>
<li>Q4: 4.2%</li>
</ul>
Malhotra noted that headline inflation softened in November-December 2024, following its 6.2% peak in October, mainly due to a decline in food inflation, particularly vegetable prices.
Going forward, food inflation is expected to ease further, supported by a good kharif harvest, lower winter vegetable prices, and favorable rabi crop conditions. Core inflation is anticipated to rise slightly but remain moderate.
However, global financial instability, volatile energy prices, and extreme weather events continue to pose risks to the inflation trajectory.
Meanwhile, the RBI Monetary Policy Committee (MPC) has decided to reduce the policy repo rate by 25 basis points (bps) from 6.5 per cent to 6.25 per cent, marking the first rate cut since May 2020.
ALSO READ: <a href="https://www.editorji.com/business-news/rbi-cuts-policy-rate-by-25-bps-to-6-25-pc-first-reduction-in-five-years-1738911995651" target="_blank">RBI cuts policy rate by 25 bps to 6.25 pc, first reduction in five years</a>
The central bank also projected the retail inflation at 4.2 per cent for next financial year beginning April while retaining the forecast for 2024-25 at 4.8 per cent.
ALSO READ: <a href="https://www.editorji.com/business-news/economy/rbi-projects-fy26-inflation-at-4-2-pc-down-from-4-8-pc-estimate-in-2024-25-1738912742906" target="_blank">RBI projects FY26 inflation at 4.2 pc, down from 4.8 pc estimate in 2024-25</a>

India's economy is expected to grow at 6.5% in FY26, driven by lower inflation and potential RBI rate cuts. Crisil’s report highlights fiscal consolidation, private sector investments, and export challenges impacting growth.

Indian economy to grow at 6.5% in FY26: Crisil

India's economy is expected to grow at 6.5% in FY26, driven by lower inflation and potential RBI rate cuts. Crisil&rsquo;s report highlights fiscal consolidation, private sector investments, and export challenges impacting growth.

India&rsquo;s economy is projected to expand by 6.5% in the financial year 2025-26 (FY26), a slight increase from the estimated 6.4% growth in FY25, according to a report by Crisil.&nbsp;
The report attributes this expected growth to lower inflation and potential rate cuts by the Reserve Bank of India (RBI), provided global conditions remain stable and the country experiences a normal monsoon. It states, "Lower inflation and the RBI's rate cuts are expected to lift growth next fiscal, assuming a normal monsoon and lower crude oil prices."
The report underscores that while government spending will continue to support economic activity, the impact of fiscal stimulus will gradually diminish due to ongoing fiscal consolidation.&nbsp;
A crucial factor for sustained growth will be private sector investments, which need to gain momentum. However, external challenges, including tariff hikes by the United States, could pose risks to India's export performance.
Inflation is projected to moderate further, with Consumer Price Index (CPI) inflation expected to decline from 4.7% in FY25 to 4.4% in FY26. This reduction will be driven by an anticipated normal monsoon, a high base effect in food inflation, and softer global commodity prices.&nbsp;
However, non-food inflation may witness a marginal uptick due to an adverse base effect. If inflation approaches the RBI&rsquo;s target of 4%, it could pave the way for additional rate cuts, further stimulating economic growth.
Crisil also forecasts a gradual reduction in India&rsquo;s fiscal deficit, which stood at 5.6% of GDP in FY24. It is expected to decline to 4.8% in FY25 and further to 4.4% in FY26, supported by disciplined revenue expenditure and a continued emphasis on capital investment.
On the external front, the current account deficit (CAD) is likely to widen from 1.0% of GDP in FY25 to 1.3% in FY26, primarily due to trade headwinds from U.S. policies affecting exports. However, a strong services trade balance, steady remittance inflows, and lower crude oil prices will help contain any sharp increase in the deficit.
The Indian rupee is projected to depreciate gradually, averaging ₹86 per dollar in FY25 and ₹87 per dollar in FY26. While the CAD remains within manageable levels, global geopolitical uncertainties may contribute to fluctuations in currency markets.
Crisil&rsquo;s outlook indicates that India&rsquo;s economy is on track for steady growth, supported by easing inflation and potential monetary policy adjustments by the RBI. However, challenges such as subdued exports and the need for stronger private investment could impact the overall growth trajectory.

The UN projects India’s economy to grow by 6.6% in 2025, supported by strong private consumption, infrastructure investment, and export performance. 

India’s Economy to Expand 6.6% in 2025: UN

The UN projects India&rsquo;s economy to grow by 6.6% in 2025, supported by strong private consumption, infrastructure investment, and export performance. Inflation is forecast to decline to 4.3%, staying within the RBI&rsquo;s target range.

The Indian economy is projected to expand by 6.6 per cent in 2025, primarily supported by robust private consumption and investment, according to a United Nations report.
The report titled <a href="https://desapublications.un.org/publications/world-economic-situation-and-prospects-2025" target="_blank">'the UN World Economic Situation and Prospects 2025'</a> was released on Wednesday.
It also said that the near-term outlook for South Asia is expected to remain robust, with growth projected at 5.7 per cent in 2025 and 6.0 per cent in 2026, &ldquo;driven by strong performance in India as well as economic recovery in a few other economies&rdquo;, including Bhutan, Nepal and Sri Lanka.
The Indian economy grew by 6.8 per cent in 2024 and is forecast to expand by 6.6 per cent in 2025. The Indian economy is projected to return to the 6.8 per cent growth in 2026.
&ldquo;The economy of India, the largest in the (South Asia) region, is forecast to expand by 6.6 per cent in 2025, primarily supported by robust private consumption and investment. Additionally, capital expenditure on infrastructure development is expected to have strong multiplier effects on growth in the coming years,&rdquo; the report said.
It added that strong export growth in services and certain goods categories, particularly pharmaceuticals and electronics, will bolster economic activity for India. On the supply side, expansion in the manufacturing and services sectors will keep driving the economy throughout the forecast period.
Meanwhile, favourable monsoon rains in 2024 have improved the summer-sowing areas for all major crops, boosting agricultural output expectations for 2025.
Investment growth has remained particularly strong in East Asia and South Asia, partly driven by domestic and foreign investments in new supply chains, particularly in India, Indonesia, and Vietnam, the report said.
In India, the public sector continues to play a pivotal role in funding large-scale infrastructure projects, physical and digital connectivity, and social infrastructure, including improvements in sanitation and water supply. Strong investment growth is expected to continue through 2025.
Consumer price inflation in India is forecast to decelerate from an estimated 4.8 per cent in 2024 to 4.3 per cent in 2025, staying within the 2&ndash;6 per cent medium-term target range set by the central bank. While decreasing energy prices have contributed to the ongoing decline, adverse weather conditions have kept prices of vegetables, cereals, and other staples elevated in 2024, resulting in spikes in the country&rsquo;s headline inflation in June and September.
It said that several developing economies, including China, India, and Mexico, have maintained robust investment growth, while African nations have faced limited public investment due to high debt servicing burdens, and Western Asia has experienced low investment growth amid subdued oil revenues.
Global economic growth is forecast at 2.8 per cent in 2025 and 2.9 per cent in 2026, largely unchanged from the rate of 2.8 per cent recorded in 2023 and estimated for 2024.
The positive but moderately slower growth projected for the two largest economies&mdash; China and the United States of America&mdash;will likely be complemented by mild recovery in the European Union, Japan, and the United Kingdom and strong performance in several large developing economies, notably India and Indonesia, it said.
China is facing the prospect of gradual economic moderation, with growth estimated at 4.9 per cent in 2024 and projected at 4.8 per cent in 2025. Public sector investments and strong export performance are partly offset by subdued consumption growth and lingering weakness in the property sector.
The Chinese authorities have stepped up policy support to lift property markets, address local government debt challenges, and boost domestic demand; the impacts of relevant initiatives are expected to be manifested over time, it said.
The shrinking population and rising trade and technology tensions, if unaddressed, could threaten the country&rsquo;s medium-term growth prospects, it said.
Among developing countries, robust momentum in India and modest growth acceleration in Africa, Western Asia, and Latin America and the Caribbean will offset a slight moderation of growth in China.
The report noted that weaker external demand, persistent debt challenges, and social unrest and political turmoil in some economies may undermine the outlook for the South Asian region.
&ldquo;However, risks to the outlook are tilted to the downside owing to the possible escalation of geopolitical tensions, deceleration in external demand, ongoing debt challenges, and social unrest. In addition, as the region is highly vulnerable to the impact of climate hazards, extreme weather events pose a significant risk,&rdquo; it said.
It said that the labour market situation in developing countries remains challenging, with significant variations in the outlook driven by differing economic conditions and policy responses. Some economies have exhibited resilience, it said adding that employment indicators in India have remained robust.
In India, employment indicators have remained strong throughout 2024, with labour force participation near record highs, the report said, citing the Reserve Bank of India data.
Urban unemployment stood at 6.6 per cent during this period&mdash;virtually unchanged from the rate of 6.7 per cent recorded in 2023. Although there has been progress in female labour market participation in the country, substantial gender gaps remain.
Climate-related shocks have battered South Asia in 2024. During the first half of the year, several of the region&rsquo;s countries&mdash;including Bangladesh, India, Pakistan, and Sri Lanka&mdash;experienced heatwaves, droughts, and irregular rainfall patterns, which led to reduced crop yields and elevated food prices.
Additionally, extreme weather events have disproportionately affected poor rural households, leading to reductions in income and widening income inequality, the report said.

India's GDP growth rate for 2024-25 is estimated at 6.4%, marking a four-year low primarily due to a slowdown in the manufacturing and services sectors. 

India’s GDP growth forecast at 6.4% for 2024-25

India's GDP growth rate for 2024-25 is estimated at 6.4%, marking a four-year low primarily due to a slowdown in the manufacturing and services sectors.&nbsp;

India's economic growth rate is estimated to slip to a four-year low of 6.4 per cent in 2024-25, mainly on account of poor showing by the manufacturing and services sector, according to government data released on Tuesday.
The gross domestic product (GDP) rate of 6.4 per cent will be the lowest since the Covid year (2020-21) when the country witnessed a negative growth of 5.8 per cent. It was 9.7 per cent in 2021-22; 7 per cent in 2022-23; and 8.2 per cent in the last fiscal ended March 2024.
The first advance estimates of National Income for 2024-25 released by the National Statistics Office (NSO) is lower than the 6.6 per cent projected by the Reserve Bank in December 2024. It is also a tad lower than the finance ministry's initial projection of 6.5-7 per cent.
The advance estimates will be used in preparation for the Union Budget to be presented by Finance Minister Nirmala Sitharaman in the Lok Sabha on February 1.
The manufacturing sector output is expected to decelerate to 5.3 per cent from a high of 9.9 per cent recorded in the previous fiscal, NSO said in the first advance estimates of National Income for 2024-25.
The services sector, comprising trade, hotels, transport and communications, is estimated to expand at 5.8 per cent against 6.4 per cent in 2023-24.
On the other hand, the farm sector is estimated to record a growth of 3.8 per cent in the current fiscal, up from 1.4 per cent in 2023-24.
"Real GDP has been estimated to grow by 6.4 per cent in FY 2024-25 as compared to the growth rate of 8.2 per cent in Provisional Estimate (PE) of GDP for FY 2023-24," NSO said.
Nominal GDP has witnessed a growth rate of 9.7 per cent in 2024-25 over the growth rate of 9.6 per cent in 2023-24.
According to the data, nominal GDP (GDP at current prices) is estimated to attain a level of Rs 324.11 lakh crore in the year 2024-25 against Rs 295.36 lakh crore in 2023-24, showing a growth rate of 9.7 per cent.
The size of the economy, as per the current estimates, is USD 3.8 trillion (@ Rs 85.7/USD) during 2024-25.
Further, the nominal Gross Value Added (GVA) is estimated to attain a level of Rs 292.64 lakh crore in 2024-25 against Rs 267.62 lakh crore in 2023-24, showing a growth rate of 9.3 per cent.
Private Final Consumption Expenditure (PFCE) at constant prices has witnessed a growth rate of 7.3 per cent during 2024-25 over the growth rate of 4 per cent in the previous financial year.
Government Final Consumption Expenditure (GFCE) at Constant Prices has rebounded to a growth rate of 4.1 per cent compared to the growth rate of 2.5 per cent in the previous fiscal.

The Ministry of Statistics also anticipates GDP expansion in FY25 to potentially surpass 7%, citing ongoing strong momentum

Statistics ministry anticipates minimal revision to FY24 GDP

The Ministry of Statistics also anticipates GDP expansion in FY25 to potentially surpass 7%, citing ongoing strong momentum

The Ministry of Statistics expects no significant downward revision to the official economic growth estimate for FY24, contrary to predictions by some analysts.
It also anticipates GDP expansion in FY25 to potentially surpass 7%, citing ongoing strong momentum.
Also read/watch -<a title=" Sensex breaks 77,000 mark for first time after PM Modi's historic third-term inauguration " href="https://www.editorji.com/business-news/markets/sensex-breaks-77-000-mark-for-first-time-after-pm-modi-s-historic-third-term-inauguration-1717995072611"> Sensex breaks 77,000 mark for first time after PM Modi's historic third-term inauguration</a>
A source within the ministry, speaking to FE, emphasized that there's no deemed need for substantial revisions in either Gross Value Added (GVA) or Gross Domestic Product (GDP) figures, asserting the robustness of the data compilation methodology for national income calculation.
As per the National Statistical Office&rsquo;s provisional estimates, India&rsquo;s GDP in FY24 grew 8.2%, while GVA grew 7.2%. The unusual gap between the two growth numbers has raised some concerns, and so has the fact that consumption growth was half the GDP rate.&nbsp;

Indian economy has grown 8.2% in FY24, remaining as a fast growing major economy even while the Jan-March quarter saw a slow pace of growth at 7.8%

India's GDP growth zooms past expectation, FY24 GDP pegged at 8.2%

<h2>Indian economy has grown 8.2% in FY24, remaining as a fast growing major economy even while the Jan-March quarter saw a slow pace of growth at 7.8%</h2>

India's GDP growth numbers have surpassed estimates. For the January to March quarter, GDP has grown 7.8%. For the full year FY24, GDP has been pegged at a strong 8.2% as compared to a growth rate of 7% in FY2022-23.
In its second advance estimate, the statistics ministry had pegged GDP growth for the financial year 2023-24 at 7.6%.
<h3>GDP growth</h3>
Meanwhile, for the January to March 2024 quarter, the GVA came in at 6.3% while for the full year 2023-2024, real GVA has grown by 7.2% compared to the 6.7% in 2022-2023.
This GVA growth has been mainly due to significant growth of 9.9% in Manufacturing sector in 2023-24 over -2.2% in 2022-23 and growth of 7.1% in 2023-24 over 1.9% in 2022-23 for Mining &amp; Quarrying sector, as per data from the Ministry of Statistics.
In FY24, the Indian economy reported growth rates of 8.2% during the April to June quarter, 8.1% in the July to September quarter, and 8.4% in the October to December quarter. Reserve Bank of India has projected a 7% GDP growth rate for the current fiscal year of FY25.
&nbsp;

ICRA projects India's GDP growth to moderate to 6.7% in Q4 FY2024, with full-year growth at 7.8%. Rural demand shows signs of revival, and investment activity remains strong despite election-related caution and the Model Code of Conduct

ICRA forecasts India’s GDP growth to moderate to 6.7% in Q4 FY2024

<h2>ICRA projects India's GDP growth to moderate to 6.7% in Q4 FY2024, with full-year growth at 7.8%. Rural demand shows signs of revival, and investment activity remains strong despite election-related caution and the Model Code of Conduct</h2>

Domestic rating agency ICRA projected India&rsquo;s GDP growth for the March quarter of FY24 to moderate to a four-quarter low of 6.7%. For the full fiscal year, ICRA estimates GDP growth at 7.8%.
<h3>GDP growth</h3>
The Indian economy demonstrated robust growth in the earlier quarters of FY2024, with GDP expanding by 8.2% in the June quarter, 8.1% in the September quarter, and 8.4% in the December quarter. However, ICRA&rsquo;s Chief Economist, Aditi Nayar, attributes the expected slowdown in the March quarter to lower volume growth and reduced profitability in certain industrial sectors due to diminishing gains from commodity prices.
India&rsquo;s GDP grew by 6.1% in the March quarter of the 2022-23 fiscal, with full-year growth for 2022-23 at 7%. The GDP figures for Q4 FY2024 and provisional estimates for the entire fiscal year are scheduled for release on May 31.
ICRA anticipates the gap between GDP and gross value added (GVA) growth to narrow to 100 basis points (bps) in Q4 FY2024, down from 185 bps in the previous quarter. This reduction is expected due to a slower expansion in net indirect taxes, influenced by a smaller decline in subsidy outgo.
For the full-year FY2024, ICRA projects GDP and GVA growth rates at 7.8% and 7%, respectively, contingent on potential revisions to the nine-month growth figures of FY2023-24.
Nayar highlighted the mixed economic signals, noting a possible revival in rural demand despite the adverse 2023 monsoon rains. She pointed to a year-on-year expansion of 7.7% in domestic retail tractor volumes in Q4 FY2024, reversing a 4% contraction in Q3 FY2024.
"Notwithstanding the overhang of the unfavourable 2023 monsoon rains on agri output, there are some green shoots suggesting that a nascent revival in rural demand may be on the anvil," Nayar said.
Additionally, listed FMCG companies reported recovery in the rural non-food segment, partly driven by marriage season demand and a low base effect. Urban consumption, though uneven, also remained robust.
"This can be partly attributed to the uptick in demand during the marriage season as well as a low base. Additionally, urban consumption is expected to have remained robust, albeit uneven in Q4 FY2024," Nayar added.
Investment activity showed strength in Q4 FY2024, with a surge in new project announcements due to state investor meets in January 2024 and increased project completions. Nonetheless, some investment indicators moderated in the March quarter compared to December, reflecting caution amid the Model Code of Conduct and election uncertainty.
ICRA also noted a 31.6% year-on-year increase in government capital expenditure to Rs 1.3 lakh crore in January-February 2024, though this may have eased in March due to the Model Code of Conduct.
Also watch: <a href="https://www.editorji.com/business-news/economy/high-probability-of-india-s-gdp-growth-touching-8-for-fy24-chief-economic-advisor-1715171404657">High probability of India's GDP growth touching 8% for FY24: Chief Economic Advisor</a>

The Chief Economic Advisor while saying that there is a high possibility of India’s economic growth touching 8% in FY24, also said that India would record 7% or higher growth for the fourth consecutive year in FY25

High probability of India's GDP growth touching 8% for FY24: Chief Economic Advisor

<h2>The Chief Economic Advisor while saying that there is a high possibility of India&rsquo;s economic growth touching 8% in FY24, also said that India would record 7% or higher growth for the fourth consecutive year in FY25</h2>

Government's Chief Economic Advisor V Anantha Nageshwaran has said that there is a high possibility of India&rsquo;s economic growth touching 8% in FY24. He further said that India would record 7% or higher growth for the fourth consecutive year in FY25 and lot of it would depend on the monsoons
"Right now, the expectations are that we will have an above-normal monsoon. But, spatial and temporal distribution (of rainfall) will matter," the CEA said
<h3>India's GDP growth</h3>
While speaking at an event in New Delhi, the CEA said that 6.5-7% growth rate was expected to continue in the coming years and it was important to maintain it. Earlier, on February 29, Nageshwaran had said that the country's continued out-performance was making a case for international organisations to raise their estimates of India's potential growth rate to 7% or even higher.
In the december quarter, India's GDP grew at 8.4% which was the highest in the last six quarters. The third quarter uptick was propelled by a double-digit growth in the manufacturing sector, with construction not too far behind, growing at 9.5%.
Following this the National Statistical Office revised its GDP growth estimate for FY24 from 7.3% to 7.6% and the RBI estimated the growth at 7%, while the International Monetary Fund (IMF) projects it at 6.8%.&nbsp;
On inflation, Nageshwaran said that he doesn't foresee any significant upside risk to inflation at the moment and expects retail inflation to remain within the midpoint of the RBI's target range of 2-6% in FY25.&nbsp;
"There can always be scenarios on the geopolitical front that can cause inflation to be more than what we expect. But at this point, our baseline scenario is that inflation gradually converges towards the midpoint of the target range in FY25," he added.
Nageshwaran also highlighted the need for growth in the small and medium enterprises (SMEs) to increase the share of manufacturing in the country's overall GDP
"Building blocks such as supply-side infrastructure, physical connectivity, digital connectivity, and financial inclusion are good work in progress," he said. &ldquo;But apart from these, ultimately, the compliance burdens and inspection burdens that businesses face at the subnational government level need to be addressed to grow the manufacturing share of GDP."
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For the world, Fitch Ratings has raised its 2024 global GDP growth forecast by 0.3% points to 2.4%, as near-term world growth prospects have improved

Fitch raises India's GDP growth forecast for fiscal year 2025 to 7% versus the earlier projection of...

<h2>For the world, Fitch Ratings has raised its 2024 global GDP growth forecast by 0.3% points to 2.4%, as near-term world growth prospects have improved</h2>

Fitch Ratings on Thursday raised its forecast for India's economic growth to 7% for fiscal year 2025 on the back of strong domestic demand and sustained level of business and consumer confidence.
FY24 growth estimate also upped
Fitch also sees the Indian economy expanding 7.8% in FY24, marginally higher than the government's estimate of 7.6%. This projection follows a stronger-than-expected 8.4% growth in gross domestic product (GDP) during the third quarter (October-December) of the current fiscal year,&nbsp;
India's strong domestic demand
In its latest 'Global Economic Outlook', the rating agency said India's economic growth continued to outperform quarterly forecasts with strong domestic demand.&nbsp;
Global economic outlook improves
For the world, Fitch Ratings has raised its 2024 GDP growth forecast by 0.3 percentage points to 2.4%, as near-term world growth prospects have improved.
This comes on the back of a sharp upward revision to its US growth forecast from 1.2% to 2.1%, in the December 2023 Global Economic Outlook (GEO).
"Stronger US growth prospects outweigh a marginal cut to our China 2024 growth forecast -- to 4.5 per cent from 4.6 per cent -- and a minor revision to our eurozone forecast, to 0.6 per cent from 0.7 per cent," it said.
The emerging markets picture
"Growth in emerging markets, excluding China, has been revised up by 0.1 percentage point to 3.2 per cent, with forecasts raised for India, Russia and Brazil." said Fitch. It expects world growth in 2025 to edge up to 2.5% as the eurozone finally recovers, on a pick-up in real wages and consumption, but as US growth slows.
India's growth may ease from current level
For India, Fitch Ratings said, "With GDP growth having exceeded 8 per cent for three consecutive quarters, we expect an easing in growth momentum in the final quarter of the current fiscal year, implying an estimate of 7.8 per cent for growth in FY24." Recent quarterly data has shown that GDP is rising much faster than gross value-added -- indirect taxes net of subsidies is the difference between the two -- and this unusually wide gap may normalise.
Strong business survey data for January and February represents an upside risk to these estimates, it said.

The CRISIL report has mentioned that India's manufacturing and service sector will be in a sturdier growth path taking India's GDP to grow at 6.8% in FY25

India to become upper middle-income country by 2031; to grow at 6.8% in FY25: CRISIL

<h2>The CRISIL report has mentioned that India's manufacturing and service sector will be in a sturdier growth path taking India's GDP to grow at 6.8% in FY25</h2>

CRISIL Ratings on Wednesday has projected India's GDP growth at 6.8% for the fiscal year 2025 while saying that the country will become an upper middle-income nation by 2031. This prediction comes as it expects the country's economy to inch closer to $7 trillion by 2031.
<h3>CRISIL on Indian economy</h3>
The report further mentioned that India can become the third largest economy by 2031 with the support from domestic structural reforms and cyclical levers.&nbsp;
"After a better-than-expected 7.6% this fiscal, India's real GDP growth will likely moderate to 6.8% in fiscal 2025," said the Crisil India Outlook report.&nbsp;
It said that the next seven fiscals (2025-2031) will see the Indian economy crossing the USD 5 trillion-mark and inching closer to USD 7 trillion. Crisil expects the economy to expand to USD 6.7 trillion by fiscal 2031.
"A projected average expansion of 6.7% in this period will make India the third-largest economy in the world and lift per capita income to the upper-middle income category by 2031," Crisil said.
Also Read: <a href="https://www.editorji.com/business-news/economy/moody-s-raises-india-s-2024-gdp-growth-estimate-to-6-8-from-earlier-forecast-of-6-1-1709537802869">Moody's raises India's 2024 GDP growth estimate to 6.8% from earlier forecast of 6.1%</a>
India, with a GDP size of USD 3.6 trillion, is currently the fifth largest economy in the world, after the US, China, Japan and Germany.
"By fiscal 2031, India will be the No. 3 economy and an upper-middle income country, which will be a big positive for domestic consumption", said CRISIL Managing Director and CEO Amish Mehta
<h3>Upper middle-income country</h3>
The report further mentioned that the per capita income in India will increase to $4,500 by 2031. As per World Bank's definition, the countries with per capita income of $1,000-$4,000 are lower-middle income countries, and upper-middle income countries are those with per capita income between USD 4,000-12,000.
India's manufacturing sector is at a sweet spot due to high capacity utilisation across key sectors, opportunities from global supply-chain diversification, thrust on infrastructure investment, the green-transition imperative and strong balance sheets of lenders.
"Continuous reforms, enhanced global competitiveness and moving up the value chain will boost the share of manufacturing in India's GDP beyond the projected 20% in fiscal 2031," Mehta said.
Crisil report said near- and medium-term challenges to growth outlook would come from geopolitics, slowing potential growth from an uneven global recovery, climate change and technological disruptions.
The report said the near term will be characterised by fiscal consolidation, with the gradually receding role of government capex and expectations of the baton being taken up by the the private sector.
Emerging sectors, which are growing faster than others, are electronics, EV, and energy transition-intensive and they account for 16% of the incremental capex in fiscals 2023 and 2024.
Through fiscal 2031, both cylinders of the economy -- manufacturing and services -- will fire, yielding a sturdier growth path.
Crisil Chief Economist Dharmakirti Joshi said there is ample opportunity for both manufacturing and services to cater to domestic and global demand.
"We project manufacturing and services to grow 9.1% and 6.9%, respectively, between fiscals 2025 and 2031. Despite some growth catch-up by manufacturing, services will remain the dominant driver of India's growth," Joshi said.

Robust growth in manufacturing and construction sectors along with high domestic demand has been credited &nbsp;for India's GDP numbers.&nbsp;

Indian economy grows 8.4% in Q3, Govt’s ‘Make-in-India’ push for semi-conductors | The India Story

Robust growth in manufacturing and construction sectors along with high domestic demand has been credited  for India's GDP numbers. 

Robust growth in manufacturing and construction sectors along with high domestic demand has been credited &nbsp;for India's GDP numbers.&nbsp;

The Indian economy grew 8.4% during the October-December quarter beating the estimates by the RBI and the Dalal Street. The RBI had pegged the growth for this quarter at 6.5%.
Also, in a big move to reduce India&rsquo;s dependency on imports to the requirement of semi-conductors, the government has approved setting up of 3 chip manufacturing units in the country.
This week on India Story, Vikram Chandra takes you through some important growth numbers.&nbsp;

In its initial estimates for 2023-24, the National Statistical Office (NSO) anticipates the Indian economy to grow by 7.3%, a slight increase from the previous fiscal year's 7.2%

India's GDP likely to grow by 7.3% in 2023-24: Government estimates 

<h2>In its initial estimates for 2023-24, the National Statistical Office (NSO) anticipates the Indian economy to grow by 7.3%, a slight increase from the previous fiscal year's 7.2%</h2>

The Indian economy is forecasted to grow at 7.3% in 2023-24, slightly up from the 7.2% of the previous fiscal year, as per the National Statistical Office's initial estimates. The real GDP is anticipated to reach Rs 171.79 lakh crore, up from the prior year's provisional estimate of Rs 160.06 lakh crore.
The growth in real GDP for 2023-24 is estimated at 7.3%, a marginal increase from 7.2% in the previous fiscal year. Additionally, the GDP at current prices is expected to be Rs 296.58 lakh crore, compared to the provisional estimate of Rs 272.41 lakh crore for 2022-23. Also read/watch -<a title=" Indian startups that aim for IPOs in 2024 encounter profitability challenges " href="https://www.editorji.com/business-news/startups/indian-startups-that-aims-for-ipos-in-2024-encounter-profitability-challenges-1704450755257"> Indian startups that aim for IPOs in 2024 encounter profitability challenges</a>
However, the growth in nominal GDP for 2023-24 is projected at 8.9%, a notable decrease from the 16.1% recorded in 2022-23.
In December 2023, the RBI revised India's GDP growth forecast for 2023-24 to 7% from its earlier projection of 6.5%.

A viral unverified screenshot on Sunday claimed India’s GDP surpassed $4 trillion, marking a historic first. However, here's what economists say about how close we are to that mark. 

India not yet a $4 trillion economy; but we are close, say economists

A viral unverified screenshot on Sunday claimed India&rsquo;s GDP surpassed $4 trillion, marking a historic first. However, here's what economists say about how close we are to that mark.&nbsp;

India is, without a doubt, one of the fastest growing economies in the world. However, it is not yet a $4 trillion economy, as claimed by a recent screenshot that went viral.&nbsp;
Social media has been abuzz with a screenshot claiming that India's GDP had reached $4 trillion, sparking discussions of India surpassing the UK as the third-largest economy. However, this is not the case.&nbsp; Economists have pointed out that while India has not reached the milestone, it is close. Projected budget numbers say that India's GDP is around $3.63 trillion. Economists like Madan Sabnavis from Bank of Baroda dismissed the likelihood of India hitting the $4 trillion mark, citing current projections.
Also read/watch - <a title="Who is the new interim Chief of OpenAI Emmett Shear succeeding Sam Altman?" href="https://www.editorji.com/business-news/who-is-the-new-interim-chief-of-openai-emmett-shear-suceeding-sam-altman-1700482107912">Who is the new interim Chief of OpenAI Emmett Shear succeeding Sam Altman?</a>
The Union Budget projected a nominal GDP of around $3.63 trillion for the current fiscal year, making a $4 trillion economy seem improbable.
"India on a rolling basis won&rsquo;t hit $4 trillion till late 2024-early 2025," Barclays India chief economist Rahul Bajoria, said in a post on X.&nbsp;
https://publish.twitter.com/?query=https%3A%2F%2Ftwitter.com%2FRahulBajoria_%2Fstatus%2F1726176727515402389&amp;widget=Tweet
Meanwhile, Deepak Shenoy of Capitalmind points out that at best we are possibly at $3.45 trillion now.&nbsp; &ldquo;A $4 trillion economy does not seem likely in the current situation. It would translate into nominal GDP of about Rs 330 lakh crore, which may be possible with a 10% growth in 2024-25,&rdquo; said Madan Sabnavis, chief economist at Bank of Baroda.
https://publish.twitter.com/?query=https%3A%2F%2Ftwitter.com%2Fdeepakshenoy%2Fstatus%2F1726223582085485037&amp;widget=Tweet
While, there was no official confirmation or denial of this, the post with the screengrab went viral and was shared by many including BJP leaders.&nbsp; Also read/watch - <a title="PhysicsWallah may lay off up to 120 employees" href="https://www.editorji.com/business-news/physics-wallah-may-lay-off-up-to-120-employees-1700481188643">PhysicsWallah may lay off up to 120 employees</a> &nbsp;
India&rsquo;s official GDP estimates are released by the National Statistical Office under the Ministry of Statistics and Programme Implementation per a scheduled calendar. Official data on GDP estimates for the second quarter of the financial year will be released at the end of this month.&nbsp;
<h4>RBI's estimate on India's GDP&nbsp;</h4>
According to recent RBI estimates, the Indian economy is expected to grow 6.5 per cent this financial year, lower than 7.2 per cent recorded in 2022-23. The International Monetary Fund (IMF) has projected growth of 6.3 per cent every year till 2028.&nbsp;

The Reserve Bank of India (RBI), which expects the GDP to grow at 6.5 per cent in FY24, has estimated a growth of 8 per cent in the April-June period

Economists anticipate Q1 GDP growth to exceed RBI's 8% estimate

The Reserve Bank of India (RBI), which expects the GDP to grow at 6.5 per cent in FY24, has estimated a growth of 8 per cent in the April-June period

The country's real GDP growth in the first quarter will be better than the Reserve Bank's estimate of 8 per cent, economists said on Tuesday.
Economists at the country's largest lender SBI pegged the growth at 8.3 per cent while domestic rating agency Icra estimated it to come even higher at 8.5 per cent.
The Reserve Bank of India (RBI), which expects the GDP to grow at 6.5 per cent in FY24, has estimated a growth of 8 per cent in the April-June period.
Official data on growth will be released later this month. In the preceding March quarter, the real GDP had grown at 6.1 per cent as compared to the year-ago period.
Both SBI and Icra credited capital expenditure by the Centre and states for their expectations of faster economic growth.
The rating agency also said that the lower base -- the GDP had contracted by nearly a fourth in the first quarter of FY21 -- as a helping factor.
A note by Soumya Kanti Ghosh, the group chief economic adviser at SBI, said the largest lender has tracked 30 high frequency indicators to come at the estimate of 8.3 per cent.
"There has been a surge in capital expenditure in Q1, with the central government spending 27.8 per cent of budgeted, while states at 12.7 per cent of budgeted,&rdquo; the note said.
States like Andhra Pradesh, Telangana and Madhya Pradesh where elections are due have registered capital expenditure growth of up to 41 per cent, it added.
Contributions of the services sector -- which has continued to deliver higher growth -- were also mentioned by SBI and Icra.
They also hinted at widening profit margins in the corporate sector as a tailwind which is benefitting the growth prospects.
However, they diverged on their views on the economic growth for the entire fiscal, with SBI estimating the FY24 growth at 6.7 per cent while Icra projecting it will come in at 6 per cent, which is much below the RBI estimate.
Icra's chief economist Aditi Nayar said the second half of the fiscal is likely to witness headwinds, which will prove a dampener.
Nayar said erratic rainfall, narrowing differentials with year-ago commodity prices, and possible slowdown in momentum of the government capex as the country approaches the Parliamentary elections will limit the growth.
In its June quarter estimates, SBI also mentioned about the continued high credit growth and the ability of the banks to persist with the same given their lean balance sheets, as being beneficial to the growth process.

In March, Fitch had lowered its forecast for the fiscal year 2024 to 6% from its earlier predicted growth rate of 6.2%. The rating agency mentioned the elevated inflation and interest rates along with subdued global demand as the reason for reducing

Fitch raises India's GDP forecast to 6.3% for current fiscal year

In March, Fitch had lowered its forecast for the fiscal year 2024 to 6% from its earlier predicted growth rate of 6.2%. The rating agency mentioned the elevated inflation and interest rates along with subdued global demand as the reason for reducing 

In March, Fitch had lowered its forecast for the fiscal year 2024 to 6% from its earlier predicted growth rate of 6.2%. The rating agency mentioned the elevated inflation and interest rates along with subdued global demand as the reason for reducing

Fitch Ratings on Thursday revised upwards its FY24 economic growth forecast for India to 6.3% from 6% it had predicted earlier.
This is primarily because of a stronger out turn in the first quarter and near-term momentum.
The growth forecast compares with 7.2% GDP expansion in FY23. In the previous fiscal year (FY22), the economy had grown 9.1%.
"India's economy has been showing broad-based strength - with GDP up by 6.1% year-on-year in 1Q23 (January-March) and auto sales, PMI surveys and credit growth remaining robust in recent months - and we have raised our forecast for the fiscal year ending in March 2024 (FY23-24) by 0.3% to 6.3%," the rating agency said.
Fitch had in March lowered its forecast for 2023-24 to 6% from 6.2% citing headwinds from elevated inflation and interest rates along with subdued global demand.
For 2024-25 and 2025-26 fiscal years, it estimated a growth of 6.5% each.
Inflation has moderated since and the domestic economy has picked up.
Stating that GDP growth in January-March was higher than expected, Fitch said there has been a recovery in manufacturing after two consecutive quarterly contractions, a boost from construction and an increase in farm output.
In expenditure terms, GDP growth was driven by domestic demand and a boost from net trade.
Recent high-frequency data point to sustained near-term momentum as highlighted by rising PMI indices, higher car sales and increased power consumption.
The economy also continues to benefit from high bank credit growth and infrastructure spending (with more to come from the latter).
"The stronger outturn in 1Q23 and near-term momentum have prompted us to upgrade our FY23-24 growth forecast to 6.3%...one of highest growth rates in the world," it said adding India's economy will be affected to an extent by slowing global trade.
The rating agency said the full impact of 250 basis points increase in interest rates by RBI (since May 2022) is still to be felt.
"Consumers have also experienced a drop in purchasing power as inflation increased sharply in 2022 and household balance sheets have also been weakened through the pandemic.
"At the same time, the government&rsquo;s push on increased capital expenditure, moderation in commodity prices and robust credit growth are expected to support investment. Slowing inflation should also start to help consumers over time and households have now turned more optimistic about future earnings and employment," it said.
The Reserve Bank of India (RBI) has kept policy rates at 6.5% since the start of the year, while headline inflation eased from a peak of 7.8% to 4.3% in May, a figure that is already within the RBI's tolerance band of 2%-6%.
Wholesale price index based inflation (WPI) has also fallen to its lowest in more than seven years to (-) 3.48% in May.
Nevertheless, while inflation has eased there are near-term upward risks in 2H23, given the monsoon outlook and the potential impact of El Ni&ntilde;o, Fitch said.
"With growth expected to moderate further, and inflationary pressures easing, we expect the RBI to pause its rate cycle for the time being before cutting early next year &ndash; a change from our previous call of one more 25bps increase to 6.75%," it added.&nbsp;

Chief economic adviser V Anantha Nageswaran has said that India's growth may exceed his initial forecast of 6.5% in the current fiscal

India's GDP: Chief economic adviser Nageswaran confident of growth prospects for FY24

Chief economic adviser V Anantha Nageswaran has said that India's growth may exceed his initial forecast of 6.5% in the current fiscal

After India reported a higher-than-expected GDP on Wednesday, the Chief Economic Adviser V Anantha Nageswaran has expressed confidence about the growth prospects of the country. He has said that India's growth may exceed his initial forecast of 6.5% in the current fiscal.
"We are prepared to stick our neck out one more time and say that the risks to 6.5% (GDP growth forecast for 2023-24) are probably more evenly balanced &ndash; that is, there is as good a chance that this number may be exceeded as there is a chance that the reality may undershoot this number," said Nageswaran.
India's economy grew by 6.1% for the Jan-Mar quarter of 2022-23 and the annual growth rate was at 7.2%. As per the data released this due to a better performance in agriculture, manufacturing, mining and construction sectors.
The Chief Economic Adviser also said that the headline retail inflation of&nbsp; India will come close to the RBI's medium-term target of 4% in 2023-24.

In the three months between October and December 2022, according to statistics released by the Reserve Bank of India, India's exports of services increased by 24.5% year over year, reaching a record $83.4 billion.

World Bank predicts that India's GDP growth will likely slow to 6.3% in FY24

In the three months between October and December 2022, according to statistics released by the Reserve Bank of India, India's exports of services increased by 24.5% year over year, reaching a record $83.4 billion.

India's GDP growth is expected to slow down to 6.3% in FY24, owing to decreased consumption as a result of slower income, as per a World Bank report.&nbsp;
Analysts and economists predict that a surge in India's services exports, which reached a new high in the quarter of October to December, will protect the economy from external risks while a slowing global economy will likely have a negative impact on the nation's merchandise exports.
According to a Reuters article, more lucrative services like consulting and research and development are now driving service exports in addition to IT services, which are no longer the only ones doing so.
In the three months from October to December 2022, India's exports of services increased by 24.5% year over year, reaching a record $83.4 billion, according to statistics released by the Reserve Bank of India.
At the end of February, the fiscal deficit of the central government reached 82.8% of the goal for the entire year. The government anticipates a deficit of ₹17.55 lakh, or 6.4% of GDP, for the entire fiscal year 2022&ndash;23. as reported by Mint

The government has kept the GDP estimate unchanged at 7% for the full financial year 2022-23

Explained: India's GDP grows at 4.4 pc in Q3

The government has kept the GDP estimate unchanged at 7% for the full financial year 2022-23

India's economic growth slowed down to 4.4 per cent in the third quarter of 2022-23 mainly due to poor performance of the manufacturing sector.
In October-December 2021, the economy grew by 11.2 per cent and by 6.3 per cent in the July-September 2022 quarter, according to data released by the National Statistical Office (NSO) on Tuesday.
The NSO in its second advance estimate of national accounts pegged the country's growth at 7 per cent for 2022-23.
Besides, the NSO revised the GDP growth for 2021-22 to 9.1 per cent against the earlier estimate of 8.7 per cent.

GDP growth for the October to December quarter (Q3) of the current financial year came in at 4.4% more or less in line with estimates.

Q3 FY23 GDP: Oct-Dec GDP growth at 4.4%

Q3 FY23 GDP OCT-DEC GDP GROWTH AT 4.4% Q3 GDP GROWTH AT 4.4% VS 6.3% IN Q2 GOVT&rsquo;S GDP ESTIMATE FOR 2022-23 AT 7%

GDP growth for the October to December quarter (Q3) came in at 4.4% versus 6.3% for the quarter ending september.&nbsp;

GDP growth for the October to December quarter (Q3) of the current financial year came in at 4.4% more or less in line with estimates. This compares to 6.3% GDP for the quarter ending September 2022.&nbsp; On a sectoral basis, for Q3, agriculture growth and mining growth came in at 3.7% each. Manufacturing saw a contraction of 1.1%. Meanwhile, construction sector grew a strong 8.4% as well as trade, hotel, transport, communications saw a 9.7% growth. Real estate and financial sector growth came in at 5.8%. The government has kept the GDP estimate unchanged at 7% for the full financial year 2022-23.&nbsp; However, the GDP growth for the previous financial year FY22 has been revised upwards to 9.1% as against an earlier estimate of 8.7%.&nbsp;

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