Aided by sustained investment growth and robust output in manufacturing, construction and certain services, India’s economy may grow at 7.3% in FY24, the government’s first advance estimates showed, higher than the central bank’s upwardly revised estimate of 7%.
This means India will remain the world’s fastest-growing major economy, following a 7.2% growth recorded in FY23. The International Monetary Fund (IMF) and the World Bank expect the Indian economy to grow at 6.3% in FY24.
While investment in fixed assets by the government and private sectors is expected to expand at over 10% and government spending at 4%, rising trade deficit is becoming a drag on growth, showed data from the Ministry of Statistics & Programme Implementation.
The latest forecast comes a month after the Reserve Bank of India (RBI) revised its growth forecast to 7% for the current fiscal year, from an earlier estimate of 6.5%, on the back of robust growth in the first two quarters of the ongoing fiscal.
The Indian economy reported higher-than-expected growth of 7.8% and 7.6% during the June and September quarters of this fiscal thanks to growth in fixed investments and government spending. Real GDP in FY24 is estimated at ₹171.79 trillion against the provisional estimate of ₹160.06 trillion for FY23 released in May last year. The ministry estimates nominal GDP growth of 8.9% in FY24, lower than the 10.5% estimated in the union budget for this year.
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