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The International Monetary Fund in April raised India’s GDP growth projection for FY24 to 7.8 per cent, compared to 6.7 per cent in its January report.
India could continue growing at an annual rate of 6.5 per cent to 7 per cent for the next decade due to its balance sheet strength in the financial and non-financial sectors, said Chief Economic Advisor (CEA) V Anantha Nageswaran on Wednesday.
Considering the trajectory in the first three quarters of financial year 2023-24 (FY24), the possibility that the growth rate touches 8 per cent is high, he said.
“As we go into the rest of the decade beyond FY25, the omens are good for us to continue the steady growth rate between 6.5 per cent and 7 per cent,” he said at an event organised by the National Council of Applied Research.
The International Monetary Fund in April raised India’s GDP growth projection for FY24 to 7.8 per cent, compared to 6.7 per cent in its January report.
The economy is better placed than before to pursue a non-inflationary growth as the country is headed to be within the central bank’s tolerance range for inflation. Inflation should head to the middle point of the target range and settle around 4 per cent subject to monsoon rains, he said.
“We don’t see the scope for nasty upside surprises at this point. There can always be scenarios in geopolitics that can cause inflation to be more than what we expect, but at this point our baseline scenario is that inflation will converge towards the midpoint of the target range.”
Nageswaran said that there are signs of an uptick in private sector investment with corporate savings minus investments showing a surplus. “This surplus is shrinking which means that they are investing.”
First Published: May 08 2024 | 2:33 PM IST
