IMF raises India’s FY24 GDP growth forecast to 7.8%

The International Monetary Fund (IMF) has projected that India’s economy will grow by 6.8% in the current fiscal year, driven primarily by public investment. Director of the Asia and Pacific Department at the IMF, stated, “In China and India, we expect investment to contribute disproportionately to growth—much of it public, especially in India.”

The IMF in its report released on 01 May, 2024 has revised its growth forecast for India upward from its January projection of 6.5% to 6.8%. Additionally, the IMF has raised its outlook for India’s FY24 growth to 7.8%, surpassing the government’s estimate of 7.6%.

The IMF report highlighted that “India and the Philippines have been the source of repeated positive growth surprises, supported by resilient domestic demand.”

Regarding inflation, the IMF said India’s inflation rate fell to a 10-month low of 4.9% in March. The IMF has maintained its FY25 forecast for India at 4.6%, with a further decrease to 4.2% in FY26. The Reserve Bank of India anticipates inflation to drop to 4.5% in the current fiscal year.