The World Bank has revised its forecast for India's GDP growth for the current financial year 2024-25, increasing it from 6.4% to 6.6%.
This revision, detailed in the latest Global Economic Prospects report, highlights India's continued position as the fastest-growing of the world's largest economies, despite an anticipated moderation in its growth rate.
The upward revision is attributed to strong public investment, an uptick in private capital expenditure, and robust private consumption.
Enhanced industrial activity, particularly in manufacturing and construction, alongside resilient services, has helped counterbalance a slowdown in agricultural production due to monsoons.
The report emphasizes that India's economy is expected to maintain an average growth rate of 6.7% per fiscal year from 2024 through 2026, solidifying South Asia's status as the world's fastest-growing region.
"India's economy has been buoyed by strong domestic demand, with a surge in investment, and robust services activity," the World Bank report noted.
GDP per capita in emerging market and developing economies (EMDEs), including India, is forecast to grow at about 3% on average over 2024-26, which is below the average of 2010-19. However, India is expected to continue experiencing solid per capita growth.
The report also highlighted the resilience of commodity importers, excluding China, with particular emphasis on India. This resilience is largely due to continued strong domestic demand, with growth being more muted in other commodity importers.
In alignment with these optimistic projections, the Reserve Bank of India recently raised its GDP forecast for 2024-25 from 7% to 7.2%.
Similarly, Morgan Stanley has forecasted a 6.8% growth rate for India in 2024.
The International Monetary Fund (IMF) has also adjusted its projections, raising India's growth outlook for 2024 from 6.5% to 6.8%, reinforcing India's status as the fastest-growing major economy.
The United Nations has similarly revised its economic growth projections for India from 6.2% to 6.9%, driven by strong public investment and resilient private consumption.
Moody's Ratings and the Organisation for Economic Co-operation and Development (OECD) both expect India to grow at 6.6% in the current financial year and the next two years, respectively.
The Asian Development Bank (ADB) has also upgraded its forecast for India's GDP growth for 2024 from 6.7% to 7%.
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