New Delhi
The Economic Survey presented by Finance Minister Nirmala Sitharaman in Parliament on Monday estimates India’s GDP growth will be between 6.5% and 7% for 2024-25, indicating a robust economic outlook. According to the April World Economic Outlook, global growth is expected to be 3.2% in 2023, with significant variations among countries due to domestic issues, geopolitical tensions, and monetary policy changes.
India has continued the strong momentum from FY23 into FY24, achieving 8.2% real GDP growth and surpassing 8% in three out of four quarters. The government’s focus on macroeconomic stability has minimized the impact of external challenges.
Capital formation has seen a boost, with Gross Fixed Capital Formation rising by 9% in real terms for 2023-24. This growth is supported by healthier corporate and bank balance sheets and increased household sector capital formation, particularly in the residential real estate market.
Inflation, impacted by global issues, supply chain disruptions, and monsoon variability, has been effectively managed through administrative and monetary measures. Retail inflation averaged 6.7% in FY23 but fell to 5.4% in FY24.
Despite increased public investment, the fiscal balance of the general government has improved due to enhanced tax compliance, expenditure control, and digitization. Although global demand for goods has weakened, strong services exports have helped reduce the Current Account Deficit (CAD) to 0.7% of GDP in FY24, down from 2.0% in FY23.
