Rating agency Fitch projects India's growth at 7% in FY 2024-25

Utkarsh Classes Last Updated 15-03-2024

Rating agency Fitch projects India's growth at 7% in FY 2024-25

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On March 14, 2024, global ratings agency Fitch revised India's GDP growth forecast to 7% for the financial year 2024-25. Agency Fitch expects the economy to continue its strong expansion.

However, Fitch has lowered its forecast for China. The company has given the reasoning behind this as the ongoing property crisis in China.
Fitch rating agency said in its March Outlook report that India's real GDP could grow at 7% for FY2025. It has increased by 0.5%.

Prospects bright for emerging markets other than China:

Fitch said in its report, the prospects for emerging markets other than China have also brightened. Fitch expects GDP growth in India to reach 7.8% in FY2024 and 7.0% in FY2025.

Government of India also increased GDP growth forecast for FY 24:

The Indian government has also recently raised its FY24 GDP growth forecast to 7.6% from 7.3% earlier.
Fitch anticipates that domestic demand, especially investment, will be the primary growth driver in India, supported by ongoing business and consumer confidence.

Global growth rate expected to increase:

Fitch also has the message in its report that the condition of the global economy will be better than estimated in the year 2024. Because it has increased the global growth rate by 0.3 percent to 2.4 percent. This improvement comes despite China's economic growth forecast being reduced from 4.6% to 4.5%.
America's growth rate is going to be better than expected, this will not affect the decline in China's economy.
The performance of the economies of Russia and Brazil is also expected to be better than expected.
While European countries like Britain and Germany are currently in recession, Fitch says that their economy will also improve next year by 2025.
Regarding India, Fitch says that the economy will get the most support from increase in domestic investment and demand.

CRISIL expressed possibility of cutting interest rates in June:

Crisil expressed the possibility of cutting interest rates in June itself. In a report released by rating agency CRISIL on March 14, 2024, the possibility of a cut in interest rates was expressed in the monetary policy review of RBI in June 2024. India's fiscal balance position is fine but the RBI will probably keep an eye on the inflation situation for a few more days.
CRISIL has estimated the economic growth rate to be 6.8 percent in the year 2024-25, while it has said that it will be 7.6 percent in the current financial year.