The Asian Development Bank (ADB) raised India’s GDP growth forecast for the current fiscal to 7 per cent from 6.7 per cent earlier. It said that the robust growth will be driven by public and private sector investment demand and gradual improvement in consumer demand. The 2024-25 growth estimate is lower than 7.6 per cent projected for the 2022-23 fiscal.
The ADB said that strong investment drove GDP growth in the 2022-23 fiscal as consumption was muted. In December last year, ADB had projected the Indian economy to expand 6.7 per cent in the 2024-25 fiscal.
What ADB said on India’s growth?
Growth will be robust despite moderating in FY2024 and FY2025, ADP said, adding, “The economy grew robustly in fiscal 2023 with strong momentum in manufacturing and services. It will continue to grow rapidly over the forecast horizon. Growth will be driven primarily by robust investment demand and improving consumption demand. Inflation will continue its downward trend in tandem with global trends.”
What ADB said on exports and monetary policy?
The ADB said exports are likely to be relatively muted this fiscal owing to growth in major advanced economies slowing down. This will improve in FY2025, it said, adding, “Monetary policy is expected to remain supportive of growth as inflation abates, while fiscal policy aims for consolidation but retains support for capital investment. On balance, growth is forecast to slow to seven per cent in FY2024 but improve to 7.2 per cent in FY2025.”
What is RBI’s growth forecast?
The ADB’s growth forecast for FY25 is in line with the projections made by the Reserve Bank of India (RBI) which said that GDP growth in the current fiscal is projected at seven per cent.
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