World Bank Projects Indian Economy To Grow By 7.5% In 2024

The World Bank has revised its projections for India's economic growth in 2024, expecting it to reach 7.5 per cent, a 1.2 per cent increase from earlier estimates. This growth is attributed to resilient activity in services and industry sectors. However, a moderate slowdown to 6.6 per cent is anticipated over the medium term.

Looking ahead, India's output growth is forecasted to reach 7.5 per cent in FY24 before moderating to 6.6 per cent in FY25, primarily due to a deceleration in investment. Despite this, fiscal deficit and government debt are projected to decline over the medium term, supported by robust output growth and government consolidation efforts.

India's economic performance in 2023Q4 surpassed expectations, with an 8.4 per cent growth driven by increased investment and government consumption. Indicators like the composite purchasing managers index (PMI) and inflation remain positive, while domestic credit issuance and foreign reserves have shown improvement.

In the South Asia region, the World Bank forecasts a robust growth of 6 percent for 2024, largely driven by India's performance, along with recoveries in Pakistan and Sri Lanka. South Asia is expected to remain the world's fastest-growing region, with a projected growth rate of 6.1 per cent in 2025. Bangladesh, Pakistan, and Sri Lanka are also anticipated to see positive growth trends in the coming years.