IMF hikes India’s GDP growth forecast for FY24 to 6.7%

31 Jan 2024 , 01:39 PM

The International Monetary Fund (IMF) has boosted India’s growth projection due to stronger-than-expected domestic demand, according to its most recent World Economic projection update for January.

The IMF now anticipates India’s GDP to rise by 6.7% in FY24, up 40 basis points from the prior prediction of 6.3% in the October 2023 edition of its report. One basis point equals one-hundredth of a %.

India’s GDP growth is expected to remain constant at 6.5% in FY25 and FY26, up 20 basis points from its October 2023 prediction, according to the IMF’s report issued on Tuesday, January 30.

The IMF forecasts 6.7% GDP growth for India in FY24, which is lower than both the Reserve Bank of India’s 7% estimate and the National Statistics Organisation’s (NSO) first advance prediction of 7.3% for the fiscal year ending March 2024.

In FY23, India’s GDP grew by 7.2% over the previous year. The Indian economy has risen by 7.7% in the first half of FY24, from April to September 2024.

Regarding FY25, the government believes India’s GDP would be closer to 7% than the 6.5% anticipated by the IMF in its most recent assessment.

On Monday, the Indian government issued a study titled ‘Indian Economy—A Review’ prepared by the office of Chief Economic Adviser V Anantha Nageswaran, which assesses the status of the economy and its progress over the previous decade.

Domestic demand has contributed to the economy’s 7%+ growth rate over the past three years. According to the research, the resilience in domestic demand, specifically private consumption and investment, can be traced back to the government’s reforms and initiatives adopted over the previous decade.

According to the CEA’s Indian economy assessment report, India is predicted to become the world’s third-largest economy over the next three years, with a GDP of $5 trillion.

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