Indian economy expected to expand by 7% in 2024–2025, with lower inflation, according to RBI head
India offers an image of development and stability in the face of a difficult global macroeconomic environment, according to RBI Governor Shaktikanta Das.
Shaktikanta Das, the governor of the Reserve Bank of India, predicted on Wednesday that the Indian economy will grow at a pace of 7% in the upcoming fiscal year and that inflation would probably decline.
Furthermore, he commended the administration for the recent structural adjustments, saying they had enhanced the medium- and long-term development prospects of the Indian economy.
The author stated that despite a challenging global macroeconomic environment, India exhibits indications of stability and prosperity.
Speaking at a CII session titled “High growth, low risk: The India story” at the World Economic Forum Annual Meeting, Das stated that while growth is still modest, recent data on the state of the global economy has been encouraging, with inflation down.
“The likelihood of a successful landing has increased as a result of the markets’ positive reaction. However, he said, “Climatic and geopolitical concerns remain important issues.”
According to the governor of the RBI, 7.2% real GDP growth is anticipated in India this year.
“India continues to be the largest economy with the quickest growth due to strong domestic demand… The latest round of global shocks has made us stronger,” he said.
Das continued by saying that the country’s strong foreign exchange reserves make managing the external balance easy.
The headline inflation rate has significantly decreased from its summer 2022 highs. This demonstrates the effectiveness of our monetary policy actions and liquidity rebalancing.”He said, “Proactive supply-side interventions by the government have also played a key role in handling food price shocks. Core inflation has also gradually and steadily moderated.”
According to Das, the average CPI inflation rate for the upcoming year is expected to be 4.5%, and the RBI is dedicated to meeting the 4% objective as soon as possible.
“We expect the Indian economy to grow by 7 per cent in 2024-25,” he stated.
The government has given the Reserve Bank of India the mandate to guarantee that retail inflation stays at 4% with a margin of 2% on each side.