Correct Answer :   6.8%

The International Monetary Fund (IMF) on Tuesday (16th April 2024) raised India’s GDP growth projection for 2024-25 by 30 basis points to 6.8 per cent in its update to the World Economic Outlook (WEO), citing buoyant domestic demand. However, the fund’s estimate is below the 7 per cent growth projection by the government.

“Growth in India is projected to remain strong at 6.8 per cent in 2024 (FY25) and 6.5 per cent in 2025 (FY26), with the robustness reflecting continuing strength in domestic demand and a rising working-age population,” the IMF said in its report. For India, according to the report, data and forecasts are presented on a financial year basis.

For FY24, the IMF raised India’s GDP growth projection to 7.8 per cent, compared to 6.7 per cent in its January report. For FY26, the IMF expects the country’s economic growth to slow down slightly to 6.5 per cent -- the same as projected in its January update.

According to the second advance estimates by the National Statistical Office, the growth rate of GDP during 2023-24 was estimated at 7.6 per cent, compared to a growth rate of 7 per cent in 2022-23.

Rating agencies, including Fitch and Barclays, recently revised India’s GDP growth projection for FY24 to 7.8 per cent due to strong domestic demand and persistent growth in business and consumer confidence levels.

The finance ministry in its last monthly economic report (for February) said that strong growth accompanied by stable inflation and external account, and progressive employment outlook would help the Indian economy close FY24 on a positive note. “There are headwinds like indications of hardening crude oil prices and global supply chain bottlenecks to trade. Nonetheless, India, on the whole, looks forward to a bright outlook for FY25,” it said.

On inflation, the fund projected India’s consumer price inflation declining from an average of 5.4 per cent in FY24 to 4.6 per cent in FY25, and further to 4.2 per cent in FY26..


Source : Business Standard

Correct Answer :   0.53%

March 2024 witnessed a positive inflation rate of 0.53% in India’s Wholesale Price Index (WPI) compared to March 2023. This inflation was primarily attributed to increased prices in food articles, electricity, crude petroleum & natural gas, machinery & equipment, and other manufacturing sectors.

Month-over-Month Change in Major Groups of WPI :

1. Primary Articles (Weight 22.62%) :  
2. Fuel & Power (Weight 13.15%) :  
3. Manufactured Products (Weight 64.23%) :
4. WPI Food Index (Weight 24.38%) :

Correct Answer :   6.1%

Moody’s Analytics projects a modest uptick in India’s economic growth for 2024, estimating a 6.1% expansion, slightly higher than the 6% projected earlier in March. Despite the growth, it remains lower than the 7.7% recorded in 2023. The report highlights concerns regarding inflation, citing India’s recent consumer price inflation hovering around 5% with no clear evidence of abating pressure.

Inflation Dynamics and RBI’s Outlook :

Moody’s Analytics underscores the persistent challenge of inflation across the Asia-Pacific (APAC) region, with uncertain trends. The Reserve Bank of India (RBI) maintains a cautious stance, particularly regarding food prices, and projects a retail inflation rate of 4.5% for the fiscal year 2024-25. Geopolitical tensions further complicate the inflation outlook, with risks to commodity prices and supply chains.

Economic Performance and Post-Pandemic Rebound :

The report assesses the economic landscapes of major APAC economies, noting a divergence in domestic demand dynamics. While China and Japan face hurdles due to weak internal demand, India and ASEAN economies benefit from a delayed but improving post-pandemic rebound. However, the output in India remains below pre-pandemic levels by 4%, indicating ongoing recovery challenges from various disruptions, including supply chain issues and geopolitical conflicts.

Regional Comparisons and Recovery Trajectories :

Moody’s Analytics places the recovery of India and Southeast Asia in the context of broader regional and global trends. Despite significant output losses compared to pre-pandemic trajectories, the Asia-Pacific region demonstrates resilience, with a forecasted growth of 3.8% in 2024, outpacing the global economy’s projected 2.5% growth.