India’s Gross Domestic Product (GDP) is estimated to have grown by 6.2-6.3 percent during the October-December quarter of the financial year 2024-25, according to a report by SBI Research. The official figures are expected to be released by the National Statistical Office (NSO) on 28 February.
The Indian economy grew by 5.4 per cent in the July-September quarter, falling short of the Reserve Bank of India’s (RBI) projection of 7 per cent.
Growth in the April-June quarter also lagged behind the central bank’s estimates.
The SBI Research report, authored by Soumya Kanti Ghosh, Group Chief Economic Adviser at the State Bank of India, described the July-September GDP figures as an anomaly.
“...patterns of demand and consumption seem buoyant in Q3 (October-December) as are capex trends… India Inc. exhibits better EBIDTA and corporate GVA (gross value added),” the report stated.
The report observed that despite challenges posed by global geopolitical tensions and disruptions to trade and supply chains, the Indian economy remained resilient. It attributed the October-December GDP estimate to an in-house developed 'Nowcasting Model' based on 36 high-frequency indicators.
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Assuming no major revisions to the earlier quarters’ data, the report forecasts full-year GDP growth at 6.3 per cent for 2024-25.
"Continuing the momentum, a healthy rural economy is further reinforcing stability and sustains momentum in other sectors even as rural agriculture wage growth is consistent and domestic tractor sales and rabi crop sown have picked up momentum," the report noted.
The report highlighted improved capital expenditure (capex) during the third quarter. While most states’ capex as a percentage of Budget Estimates (BE) remained lower in 2024-25, there was a discernible uptick in Q3, signalling future growth prospects.
"The slowdown in Q3CY24—down by intensifying geopolitical developments, supply chain disruption and the consequent imported inflationary pressures—was not just for India. Despite that, India continued to remain one of the fastest growing economies," it added.
SBI Research also referenced the International Monetary Fund’s (IMF) latest projections, which place India’s GDP growth at 6.5 per cent for both 2024-25 and 2025-26. The IMF’s assessment credits robust domestic demand, government policy interventions, and infrastructure development for the nation’s economic trajectory.
India’s GDP grew by 8.2 per cent in 2023-24, maintaining its position as the fastest-growing major economy. In the preceding years, the economy expanded by 7.2 per cent in 2022-23 and 8.7 per cent in 2021-22.
The Reserve Bank of India recently revised its growth forecast for 2024-25 to 6.6 per cent from an earlier projection of 7.2 per cent. The Union Government, meanwhile, expects the economy to grow by 6.4 per cent during the same period.
According to the Economic Survey presented on 31 January, India’s GDP is projected to expand between 6.3 per cent and 6.8 per cent in 2025-26.
The survey highlighted the country’s strong economic fundamentals, backed by a stable external account, fiscal consolidation, and rising private consumption.
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