However, India will remain the fastest growing economy among the seven largest emerging market and developing economies (EMDEs), the World Bank said in its new projection on the Indian economy.
India’s Economic Growth Rate (India’s GDP) It will come down to 6.6 percent in the next financial year i.e. 2023-24. World Bank It assumed. The growth rate is estimated at 6.9 percent in the current financial year 2022-23. The World Bank on the Indian Economy However, India will remain the fastest growing economy among the seven largest emerging market and developing economies (EMDEs), according to its new estimates. The economic growth rate was 8.7 percent in the fiscal year 2021-22. The growth rate is estimated at 6.1 percent in FY 2024-25.
India’s GDP will be 6.6 percent
A slowdown in the global economy and growing uncertainty will impact export and investment growth, the statement said. The government has increased spending on infrastructure and facilities for businesses. However, it will help spur private investment and help expand manufacturing capacity. According to the World Bank, the growth rate is expected to fall to 6.6 percent in the fiscal year 2023-24. After that, it may drop to slightly above six percent.
Inflation was above tolerance
In the first half of the current financial year (April-September), the growth rate of gross domestic product (GDP) has been 9.7 percent on an annual basis. It indicates an increase in private consumption and investment. Consumer price index-based inflation remained above the Reserve Bank of India’s (RBI) tolerance level of six percent for most of last year. Due to this, the central bank increased the key policy rate repo by 2.25 percent between May and December.
Trade deficit has widened since 2019
India’s merchandise trade deficit has more than doubled since 2019 and stood at $24 billion in November. The trade deficit was $4.2 billion due to crude petroleum and petroleum products ($7.6 billion) and other items such as ores and minerals. The World Bank said India used its international reserves ($550 billion in November, or 16 percent of GDP) to hedge exchange rate volatility to prevent the rupee from falling.