Even as India has a high domestic demand and a rising working-age population, the International Monetary Fund (IMF) has projected the country’s economic growth rate for 2024 at 6.8 per cent, which is the highest among the major economies in the world. It is followed by China (4.6 per cent) and Nigeria (3.3 per cent).
“Growth in India is projected to remain strong at 6.8 per cent in 2024 and 6.5 per cent in 2025, with the robustness reflecting continuing strength in domestic demand and a rising working-age population,” the IMF said in its ‘World Economic Outlook April 2024’.
The 6.8 per cent GDP growth projection for India for 2024 is also way higher than the global growth estimate of 3.2 per cent.
IMF’s latest growth forecast for 2024:
India: 6.8%
China: 4.6%
Nigeria: 3.3%
Russia: 3.2%
US: 2.7%
Mexico: 2.4%
Saudi Arabia: 2.6%
Brazil: 2.2%
Spain: 1.9%
Japan: 0.9%
Italy: 0.7%
France: 0.7%
UK: 0.5%
South Africa: 0.9%
Germany: 0.2%.
On global growth, the IMF said global growth, estimated at 3.2 per cent in 2023, is projected to continue at the same pace in 2024 and 2025. The forecast for 2024 is revised up by 0.1 percentage point from the January 2024 World Economic Outlook (WEO) Update, and by 0.3 percentage point from the October 2023 WEO.
“The global economy has shown remarkable resilience, with steady growth defying recession fears. We project global growth at 3.2 per cent in 2024 and 2025 in our latest WEO — a slight upgrade but below the 3.8 per cent historical average,” it said.
The IMF also said the pace of expansion is low by historical standards, owing to both near-term factors, such as still-high borrowing costs and withdrawal of fiscal support, and longer-term effects from the COVID-19 pandemic and Russia’s invasion of Ukraine; weak growth in productivity; and increasing geoeconomic fragmentation.
“Global headline inflation is expected to fall from an annual average of 6.8 per cent in 2023 to 5.9 per cent in 2024 and 4.5 per cent in 2025, with advanced economies returning to their inflation targets sooner than emerging market and developing economies,” the International Monetary Fund added.
In the October-December 2023 quarter (Q3 FY24), India’s gross domestic product (GDP) grew 8.4 per cent y-o-y as compared with the 4.3 per cent growth recorded a year ago, according to the official data. The Q3 FY24 GDP growth was higher than what was expected by analysts.
The Indian economy had grown 7.6 per cent in the preceding July-September 2023 quarter.
Robust 8.4% GDP growth in Q3 2023-24 shows the strength of Indian economy and its potential, Prime Minister Narendra Modi had said.
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