According to the Federation of Indian Chambers of Commerce & Industry (FICCI) estimate, India’s GDP is expected to grow at a healthy rate of 7.0% India’s GDP to fall in the fiscal year 2024-25. This optimistic scenario is possible to achieve even in the face of global economic instability and internal issues, which speaks about India’s stability and opportunities for becoming one of the fastest-growing large economies. Here, we are discussing FICCI Forecasts 7.0% Annual GDP Growth for India in 2024-25.
Economic Outlook Survey
According to the FICCI’s Economic Outlook Survey, India demonstrates stable economic growth supported by domestic consumption, structural changes, and suitable policies. From the survey, the average GDP growth rate for the first and second quarters of the 2024-2025 financial year stands at 6.8% and 7.2%, respectively.
According to the industry body, the optimism stems from several factors, such as the expectation that the southwest monsoon will improve this year, making it ideal for agriculture outputs. Currently, the median growth forecast for agriculture and allied activities is expected to grow at a rate of 3.7% for 2024-25, higher than the 1.4% increase projected for 2023-24.
Growth Projections
The industry and services sectors are also projected to make a good contribution to the GDP growth rate. According to FICCI, they predict the industry sector to grow by 6.7%, and the construction sector is expected to grow by 6.4% in the current fiscal year. These projections referred to the sustained climb and growth across several sectors such as manufacturing, construction, and information technologies. Subsequently, the economic growth expectation supports India’s strategic position in the global economy and the potential for enterprise and investment. This paper aims to highlight that, with the principles of sustainable and inclusive growth, India is set to achieve several firsts in its economic development.
Inflation and Monetary Policy
Inflation is still a big factor that affects growth in the economy. The survey participants have placed the median forecast for CPI-based inflation at 4.5 percent for 2023-24 with the expected range of 4.4% to 5.0%. Although the food prices have been relatively rigid, particularly in cereals fruits, and milk some easing is expected in the second quarter with the arrival of kharif production.
As for the monetary policy, the RBI will also be prudent and will continue to focus on inflation while making its policy decisions. The economists who were surveyed expect the reduction in the repo rate only in the second half of the fiscal year. The policy repo rate is expected to decrease to a moderate of 6.0% by the end of the FY 2024-25.
Fiscal Management
The survey also features information about the government’s sound fiscal policies and their effect on the macroeconomic environment. Economists have applauded the government’s efforts to mobilize extra resources from improved tax directories and the Reserve Bank of India’s dividend transfer. This fiscal headroom is expected to be utilized to step up spending on social sector expenditures, especially for the rural economy.
Continuity in Policy and Momentum
The Union Budget 2024-25 is expected to be consistent in policy and reform more quickly. These reforms are anticipated to improve the business climate, encourage investment, and consequently promote growth. The government’s emphasis on capital expenditure is also expected to persist, and the target can be assumed to have risen from Rs 11.1 trillion, as seen in the interim budget for FY 2025.
Global Economic Environment
The global economic climate also constrains India’s growth trend. The country has a big and diverse economy along with a demographic dividend, which gives it the flexibility to manage global volatility and maintain high growth rates. The International Monetary Fund has also revised its GDP growth estimate for India to 7.0 percent for 2024-25 as against the previous estimate of 6.8%. This revision is due to enhanced contemporary private consumption, especially in rural Indian areas, and government reforms.
Conclusion
FICCI’s forecast of 7.0% overall GDP growth rate for India in fiscal 2024-25 demonstrates the strength of the Indian economy and the possibility of future development. So, as India struggles on the world front, it has strong economic indicators and is reforming; thus, growth and development are predicted in the years to come.
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