The United Nations has revised India’s growth projections for the year 2024, painting a brighter economic outlook for the country. The latest forecast indicates that India’s economy is poised to expand by nearly 7% this year, marking a notable uptick from previous estimates. The World Economic Situation and Prospects as of mid-2024, released Thursday, said, India’s economy is forecast to expand by 6.9 % in 2024 and 6.6 % in 2025, mainly driven by strong public investment and resilient private consumption.
Although subdued external demand will continue to weigh on merchandise export growth; pharmaceuticals and chemicals exports are expected to expand strongly. The mid-year update projects a 6.9% economic growth for India, marking an increase from the 6.2% GDP forecast by the UN earlier this year. In the UN World Economic Situation and Prospects 2024 report released in January, India’s growth was anticipated to hit 6.2% in 2024, buoyed by vigorous domestic demand and notable expansion in the manufacturing and services domains. Whereas, the projection in January for India’s GDP growth for 2025 remains unchanged at 6.6 percent in the latest assessment of the economic situation
Meanwhile, consumer price inflation in India is anticipated to ease from 5.6% in 2023 to 4.5% in 2024, remaining within the central bank’s target range of two to six percent over the medium term. Likewise, inflation rates in other South Asian nations decreased in 2023 and are projected to slow down further in 2024, spanning from 2.2% in the Maldives and 33.6% in Iran. Despite some moderation, food prices remained high in the first quarter of 2024, particularly in Bangladesh and India
In India, labor market indicators have also improved amid robust growth and higher labor force participation, it said. India’s government remains committed to gradually reduce the fiscal deficit while seeking to increase capital investment
The upward revision comes as a result of several key factors, prominently including robust public investment initiatives and the resilient performance of private consumption. These elements have emerged as major drivers propelling India’s economic trajectory amidst evolving global dynamics. This revised growth projection underscores the resilience and potential of India’s economy, positioning the nation as a significant player in the global economic landscape. As the country navigates various challenges and opportunities, this optimistic forecast signals a promising path forward for India’s economic growth and development in the coming year
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