Mumbai: Leading rating agency, India Ratings and Research (Ind-Ra) has revised India’s GDP growth estimate for FY24. The agency hiked the GDP growth rate to 6.7 per cent, from 6.2 per cent earlier. The agency cited a resilient economy, sustained government capital expenditure and the potential for a new private corporate capital expenditure cycle for the upgrade.
‘This (the GDP growth upward revision) has been led by a number of factors: i) the resilience of the Indian economy, which grew 7.6% yoy in 2QFY24 (higher than any forecast including the Reserve Bank of India’s (RBI)), after growing 7.8% yoy in 1QFY24, ii) sustained government capex, iii) deleveraged balance sheet of corporates/banking sector, iv) the prospect of a new private corporate capex cycle, and v) sustained momentum in business and software services exports, coupled with remittances from the rest of the world despite global headwinds,’ India Ratings said in a statement.
Also Read: Dubai Duty Free Draw: Indian national wins $1 million grand prize
It also noted that a weak global growth, trade risks and volatile geopolitical situations may hinder growth. These risks will limit India’s GDP growth to 6.7 per cent in FY24. The quarterly GDP growth, which was 7.8 per cent YoY and 7.6 per cent YoY in Q1 FY24 and Q2 FY24 respectively, is expected to decrease sequentially in the last two quarters of FY24.
The Reserve Bank of India (RBI) also anticipates a sequential slowdown in GDP growth in the final two quarters and projects the overall FY24 GDP to be 7 per cent. The Indian economy had grown by 7.2 per cent in the 2022-23 fiscal year.
The World Trade Organization expects the world merchandise trade volume to have grown only 0.8 per cent yoy as against the expected 1.7 per cent in 2023. However, WTO expects world merchandise trade volume to grow 3.3 per cent yoy in 2024.
Post Your Comments