World Bank rises India FY25 growth projection to 6.6%; pegs FY24 GDP at 7.5%

India's statistics ministry pegged the current year's growth rate at 7.6%, 30 basis points higher than its first advance estimate of 7.3%

PGurus Newsdesk

April 3, 2024

India's statistics ministry pegged the current year's growth rate at 7.6%, 30 basis points higher than its first advance estimate of 7.3%

Growth in South Asia is projected at 6.0–6.1% in 2024–25 largely due to robust economic activity in India, says World Bank

The World Bank on April 2 raised its GDP growth projection for India by 20 basis points to 6.6 percent in FY25. The projection for FY25 is significantly moderate compared to the estimate of a real GDP growth of 7.5 percent in the current financial year.

However, it expects growth to pick up in subsequent years as a decade of robust public investment starts yielding dividends.

In its second advance estimate of GDP for 2023-24, India’s statistics ministry pegged the current year’s growth rate at 7.6 percent, 30 basis points higher than its first advance estimate of 7.3 percent.

Inflationary pressures are expected to subside, creating more policy space for easing financial conditions. Over the medium term, the fiscal deficit and government debt are projected to decline, supported by robust output growth and consolidation efforts by the central government, the World Bank said in its South Asia Development Update for April 2024.

The Update said that growth in South Asia is projected at 6.0–6.1 percent in 2024–25, stronger than in other emerging markets and developing economies, largely due to robust economic activity in India.

“In the rest of the region, while picking up, growth is expected to remain mostly well below pre-pandemic averages,” as per the April 2024 Update.

South Asia as used in this report includes Afghanistan, Bangladesh, Bhutan, India, Maldives, Nepal, Pakistan, and Sri Lanka.

South Asia’s growth outlook is somewhat stronger than in the previous edition of this report, by 0.4 percentage points for 2024 and 0.3 percentage points for 2025. This is primarily due to upward revisions to investment growth in India and somewhat faster-than-anticipated rebounds from last year’s recessions in Pakistan and Sri Lanka, the World Bank said in its Update.

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