ADB keeps India’s FY24 growth forecast at 6.4% banking on demand strength

ADB keeps India’s FY24 growth forecast at 6.4% banking on demand strength

• The Asian Development Bank (ADB) recently projected India’s economic growth to moderate in the current financial year, FY24, to 6.4 per cent, down from the 6.8 per cent expansion witnessed in FY23. The slowdown is attributed to tight monetary conditions and elevated oil prices. However, ADB remains optimistic about India’s economic prospects, expecting growth to accelerate to 6.7 per cent in FY25.
• Despite the ongoing global economic slowdown, India’s economic growth rate stands stronger compared to many peer economies. ADB attributes this resilience to robust domestic consumption and reduced reliance on global demand. The government’s proactive infrastructure push through initiatives like the Gati Shakti (National Master Plan for Multimodal Connectivity) project is expected to contribute significantly to raising industrial competitiveness and driving future growth.
• ADB predicts that inflation will likely moderate to 5 per cent in FY24, assuming a decline in oil and food prices. It is projected to further slow to 4.5 per cent in FY25 as inflationary pressures subside. Monetary policy is expected to be tighter in FY24 due to persistent core inflation, but it is likely to become more accommodative in FY25.

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Published date : 19 Jul 2023 06:11PM