India to remain fastest growing economy in the upcoming years

by Psu Connect
Date: 01-01-24

India to most probably remain the fastest-growing major economy in the world in 2024 on the back of strong consumer demand leading to hefty investments by foreign institutions and growing demands of IT and major PSU entities for rapid transformations.

India to remain fastest growing economy in the upcoming years

India is witnessing a positive acceleration towards an increasing graph of economical growth amid global economic and financial fluctuations, somewhere stunned by market volatility. The current GDP growth assumed by different resources and firms is acclaimed to be 6.5% to 7%, depending upon variations. The stock market growth as per BSE and Nifty, the market has mostly been prosperous due to great investments and agreements. This was facilitated by a moderate inflation rate, stable interest rates by RBI and US Federal Reserve and a robust forex reserve. Despite global turmoil headwinds, India has achieved the milestone of 6.1 percent of GDP growth in the March quarter. The growth moved up to 7.8 percent in the June quarter and was 7.6 percent in the September quarter.

The GDP growth rate as expected by OECD [Organization for Economic Cooperation and Development], is around 6.3 percent in 2023, ahead of China and Brazil at 5.2 percent and 3 percent. For FY24, the OECD has expected Indian growth at 6.1 percent and China at 4.7 percent. As per the World Economic Outlook Report, published by IMF [ International Monetary Fund], the global growth is estimated to reduce from 3.5 percent in 2022 to 3 percent in 2023 and further to 2.9 percent in 2024.

India's macro economy appears to be in a good place in 2024. The growth is expected at 6.5 percent in FY24 and 6.2 percent in FY25.

As per RBI's DSGE model, the retail inflation during the financial year 2024-25 is projected to decline to 4.8 percent from 4.9 percent, as of the current fiscal year.

The RBI's dynamic Stochastic General Equilibrium [DSGE] model, projected a growth rate of 6 percent in the next two financial years. The CAD [ Current account deficit] had marked a remarkable improvement to narrow down sharply at 1 percent of GDP in the September 2023 quarter against 3.8 percent in the previous year. Meanwhile, the foreign exchange reserve has crossed 600 billion dollar mark in the previous month after four months. The most comfortable point for expanding financial growth was stimulated with the help of unchanged interest rates by US fed meet and RBI's monetary policy committee.