Growth in Bharat, which already is strong and surging, may become more broad-based across both on the consumer and business spending side, indicated Morgan Stanley.
The global investment bank, in its latest report ‘2024 Global Economic Midyear Outlook’, attributed India’s firm growth to three megatrends — global offshoring, digitalization, and energy transition.
Morgan Stanley forecasts 6.8 % growth in 2024 (against RBI’s 7 %), and 6.5 % the next, and thinks inflation will stay within policymakers’ comfort zone.
Retail inflation clocked 4.83 % in April 2024, the lowest in the past 11 months. The retail inflation in Bharat, though, is in RBI’s 2-6 % comfort level but is above the ideal 4 per cent scenario. Inflation has been a concern for many countries, including advanced economies, but India has largely managed to steer its inflation trajectory quite well.
“The stronger global growth we are predicting benefits India, leading to higher income from exports and supporting domestic capital spending,” Morgan Stanley said.
In the report, the investment bank noted that there is potential for a faster-than-expected recovery in capital expenditures (which increased multifold in the past decade), driven by a stronger business environment and policy reforms.
Bharat’s GDP grew at a massive 8.4 per cent during the October-December quarter of the financial year 2023-24, and the country continued to remain the fastest-growing major economy. India’s economy grew 7.2 per cent in 2022-23 and 8.7 per cent in 2021-22, respectively.
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