The GDP of India is expected to grow at 6.5 to 7 per cent in FY24-25, according to the Economic Survey 2023-24 tabled by the Union Finance Minister in the Parliament on Monday. The GDP growth rate projected by the Survey is lower than 8.2 per cent growth recorded in the financial year 2023-24 and over 7 per cent growth seen in the last three financial years.
“…the Survey conservatively projects a real GDP growth of 6.57 per cent, with risks evenly balanced, cognizant of the fact that the market expectations are on the higher side,” said the document tabled by Finance Minister Nirmala Sitharaman in Parliament.
The Economic Survey is an annual document presented by the Centre ahead of the Union Budget to review the state of the economy. The document also provides an overview of the short-to-medium-term prospects of the economy.
Noting that the anticipated monetary policy easing by the Reserve Bank of India (RBI) has been delayed, the Survey has made a case for changing the inflation targeting framework of the central bank by excluding food inflation.
The RBI and the IMF have projected that India’s consumer price inflation will progressively align towards the inflation target in FY26. Assuming a normal monsoon and no further external or policy shocks, the RBI expects headline inflation to be 4.5 per cent in FY25 and 4.1 per cent in FY26.
IMF10 has projected an inflation rate of 4.6 per cent in 2024 and 4.2 per cent in 2025 for India. Remittances to India to grow at 3.7% to USD 124 billion in 2024, 4% in 2025 to reach USD 129 billion.
Despite global supply chain disruptions and adverse weather conditions, domestic inflationary pressures moderated in FY24, the Survey said. After averaging 6.7 per cent in FY23, retail inflation declined to 5.4 per cent in FY24.
Chief Economic Advisor V Anantha Nageswaran in the preface of the Survey has pointed out that though the Indian economy is on a strong wicket and stable footing, there has to be heavy lifting on the domestic front for recovery to be sustained.
