The Asian Development Bank (ADB) has retained its economic growth forecast for India, projecting a growth rate of 6.4% for the current financial year and 6.7% for the next financial year. The ADB credited the strong domestic demand that has continued to support the region’s recovery.
This forecast aligns with the projection made by the Reserve Bank of India’s Monetary Policy Committee, which estimated GDP growth for 2023-24 at 6.5%. In the previous fiscal year that ended in March 2023, India recorded a real GDP growth rate of 7.2%.
This positive outlook follows other recent upward revisions of India’s growth forecast. Fitch Ratings raised its projection to 6.3% for the current fiscal year, while the World Bank also pegged India’s GDP growth forecast at 6.3% for FY24.
In addition to the growth forecast, the ADB’s outlook highlighted a decline in inflation, which is approaching pre-pandemic levels due to a decrease in fuel and food prices. The ADB projected an inflation rate of 3.6% for Asia’s developing economies and 3.4% for 2024.
The retention of India’s growth forecast by the ADB reflects confidence in the country’s economic recovery and the resilience of domestic demand. It is a positive indication for policymakers, businesses, and investors, providing stability and direction amid the ongoing global economic uncertainties.
The Indian government has implemented several measures to support economic growth, including fiscal stimulus packages, structural reforms, and initiatives to boost domestic manufacturing and infrastructure development. These efforts have helped maintain momentum in the economy and position India for a strong recovery.
However, it is important to note that risks and challenges remain. The global economic landscape continues to evolve, and uncertainties surrounding the COVID-19 pandemic and geopolitical tensions could impact the pace of India’s economic growth. Monitoring and addressing these risks will be crucial to sustaining and accelerating the recovery.
The ADB’s outlook serves as a valuable reference for policymakers and stakeholders in shaping economic strategies and investment decisions. As India moves forward, it will be essential to continue fostering an environment conducive to growth, promoting innovation, and addressing key structural issues to ensure long-term sustainable development and inclusive growth for all segments of society.
The retained growth forecast by the ADB reflects the ongoing efforts and resilience of India’s economy, highlighting the potential for sustained recovery and future expansion. With continued focus on reforms and targeted policies, India can leverage its domestic strengths and navigate global challenges to emerge as a robust and dynamic economic powerhouse.