India’s GDP growth to drop in coming months, IMF projects 6.1% growth in FY24
The IMF forecasts a dip in India's GDP growth, with growth falling to 6.1% this year and rising slightly to 6.3% in FY25. The RBI projected 6.5% growth, while the World Bank projected 6.3%.
The International Monetary Fund forecast a dip in India's GDP growth over the next two years. Data released on Tuesday indicated that India's GDP growth would fall from 7.2% in FY23 to 6.1% in the current financial year, and then rise slightly to 6.3% in FY25.
"For India, data and projections are presented on a fiscal year basis, with FY 2022/23 (starting in April 2022) shown in the 2022 column. India's growth projections are 6.6% in 2023 and 5.8% in 2024 based on calendar year," the IMF explained.
The latest World Economic Outlook data projected a 0.2% point upward revision from its April estimates, reflecting momentum from stronger-than-expected growth in the fourth quarter of 2022 as a result of stronger domestic investment.
It is pertinent to note that the Reserve Bank of India has projected 6.5% growth for this fiscal year while the World Bank's projection stands at 6.3% .
The IMF also raised its 2023 global growth estimates slightly on Tuesday but warned that persistent challenges were dampening the medium-term outlook. The global lender said it now projected global real GDP growth of 3.0% in 2023 - up 0.2 percentage point from its April forecast. It however left its outlook for 2024 unchanged at 3.0%.
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Asia's third-largest economy beat all estimates to grow at 6.1% in the final quarter of FY23 - up from a revised 4.5% in the previous quarter. Government data released at the end of March showed the annual growth rate reaching 7.2% while India became a $3.3 trillion economy.
An RBI bulletin released earlier in July also said that India could become a developed country by 2047 with an average annual real GDP growth of 7.6% over the next 25 years.
Meanwhile, World Bank President Ajay Banga recently opined that domestic consumption provides a natural cushion to the country's economy against global slowdown as bulk of the GDP depends on local demand.
(With inputs from agencies)
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First Published:25 Jul 2023, 07:21 PM IST
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