The International Monetary Fund (IMF) has increased India’s GDP growth projection for FY25 by 20 basis points to 6.5 percent, although it remains slightly below the expectations of Indian authorities. Furthermore, they have also increased their FY24 GDP growth forecast by 40 bps to 6.7%.
This upward revision aligns with the upcoming presentation of the 2024-25 interim Budget, where the Indian finance ministry is expected to take measures to enhance finances and growth prospects. A Moneycontrol economist survey suggests Finance Minister Nirmala Sitharaman might target a fiscal deficit of 5.3 percent of GDP for 2024-25. Additionally, economists anticipate Budget figures to assume a nominal GDP growth of 10.5 percent for the next year.
The statistics ministry’s initial advance estimate for 2023-24 suggests real GDP growth of 8.9 percent, while the finance ministry, in a January 29 report, indicates the economy’s growth rate might approach 7 percent in 2024-25.
According to the latest IMF forecasts, consumer prices are expected to rise by 5.8 percent in 2024 and 4.4 percent in 2025, following a 6.8 percent increase in 2023.
