SBI Research expects the Indian economy to increase 7.1% in the first quarter (April-June) of the current financial year, led by a strong agriculture sector.
The RBI expects India’s GDP growth of 7.2% for 2024-25, with Q1 at 7.1%, Q2 at 7.2%, Q3 at 7.3%, and Q4 at 7.2%.
In its latest Ecowrap analysis, SBI Research found that the Indian economy survived supply chain stresses including increased global freight and container prices and semiconductor shortages.
As the southwest monsoon has recovered, the research predicts agricultural growth to rebound to 4.5-5% in FY25, 0.3% better than the RBI’s prediction.
After a disappointing June, the southwest monsoon improved in early July, narrowing the gap.
As of August 25, 2024, total rainfall was 5% over the LPA, up from 7% below previous year.
This has increased kharif agricultural planting to 103.1 million hectares as of August 20, 2024, 2% more than previous year.
Although the global economic growth forecast is unclear, lowering inflation has allowed monetary policy relaxing, the research says.
The Economic Survey presented in Parliament last month “conservatively” predicted 6.5-7% real GDP growth for 2024-25. The analysis considered global economic risks due to rising geopolitical tensions and restrictive monetary policies that hinder growth.
Despite the global situation becoming more difficult since the start of the year, Chief Economic Adviser Anantha Nageswaran claimed India may achieve 7% GDP growth.
We were more certain about 7% GDP growth when we produced the January interim economic survey. Since then, global polarization has increased. We think 7% is possible, but we want to be judicious, Nageswaran added.
The SBI research indicated that the global economy’s growth forecast is unclear, but inflation has lowered, allowing for monetary policy relaxation.
India remained a bright light during the global economic slump with 8.2% growth in the fiscal year ending March 31, 2024.
In July, the IMF boosted India’s 2024 growth predictions from 6.8% to 7%, confirming its standing as the fastest-growing emerging market and developing economy.
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