The Indian economy is swiftly advancing to the forefront of the global stage, with an unwavering pace that promises to continue. This isn't just optimistic speculation; the International Monetary Fund (IMF) validates this expectation. The global institution has brightened India's outlook and escalated its GDP growth forecast to 6.8%, up from the prior 6.5%. Meanwhile, concerns loom over China's economic trajectory.
The Velocity at Which Indian Economy Will Progress
With the Lok Sabha Election 2024 on the horizon, the Indian economy has been on a streak of positive news. From the World Bank to Fitch-ADB and Moody's, confidence in India's rapid economic acceleration has been unanimous. The IMF has now joined this chorus of optimism with an upgraded forecast for the fiscal year 2024-25 at an impressive growth rate of 6.8%, a jump from their January estimate of 6.5%.
IMF Elevates Growth Rate by 30 Basis Points
For the current fiscal year, the IMF has increased its anticipated growth rate for India by 0.30%, while it maintains a steady 6.5% estimate for the fiscal year 2025-26. The report explains that this upward revision in the outlook is attributed to a robust domestic demand and a growing working-age population. The IMF's new projection closely aligns with that of the Reserve Bank of India (RBI), which had earlier forecasted a 7% growth for the current financial year, commencing April 1st.
New Predictions from World Bank to ADB
Institution
GDP Growth Estimate (FY24-25)
IMF
6.8%
ADB
7%
World Bank
6.6%
Moody's
6.1%
Fitch
7.8%
Chinese Economy Expected to Persist in Slowdown
The IMF forecasts that the global GDP growth will maintain at 3.2% for the years 2024 and 2025. Concurrently, China has been dealt another blow. The IMF has downgraded China's growth rate to 4.6% for the current fiscal year and predicts it to further decrease to 4.1% in 2025, a stark decline from the earlier estimate of 5.2%. The global body attributes this downward revision to the ongoing real estate crisis in China and the transformational aftereffects of the Corona pandemic.
