The Reserve Bank of India on Monday said the real Gross Domestic Product growth is expected to recover in the third and fourth quarter of the current financial year.
Representation image (Photo: iStock)
The Reserve Bank of India on Monday said the real Gross Domestic Product growth is expected to recover in the third and fourth quarter of the current financial year.
It will be riding on the back of pick up in domestic drivers, mainly public consumption and investment, strong service exports and easy financial conditions, it said.
Advertisement
RBI in its Financial Stability Report said despite this recent deceleration, structural growth drivers remain intact. Real GDP growth is expected to recover in Q3 and Q4 of 2024-25.
Advertisement
Real GDP is projected to grow at 6.6% in 2024-25 aided by revival in rural consumption, pickup in government consumption and investment and strong services exports.
The underlying growth momentum remains strong and is supported by the steadfast focus of monetary policy on a durable alignment of inflation to the target.
A stable financial system, bolstered by healthy balance sheets and profitability of banks and non-banks and reasonable expansion in credit, is providing support to businesses and households, the RBI report said.
During H1:2024-25, real GDP growth (y-o-y) moderated to 6% from 8.2% and 8.1% growth recorded during H1 and H2 of 2023- 24, respectively.
Despite this recent deceleration, structural growth drivers remain intact, RBI said.
Recently, the Asian Development Bank (ADB) lowered India’s economic growth forecast to 6.5% for the current financial year due to lower-than-expected growth in private investment and housing demand. Earlier it estimated the growth of 7%
The multilateral development bank has also lowered India’s growth forecast for the 2025-26 financial year.
“India’s outlook is adjusted downward from 7% to 6.5% for this year, and from 7.2% to 7% next year, due to lower-than-expected growth in private investment and housing demand,” ADB said.
Advertisement
