Moody's Analytics forecasts 6.1% GDP growth for India in 2024
What's the story
Moody's Analytics has predicted a 6.1% growth rate for India's economy in 2024, indicating a slowdown from the previous year's expansion of 7.7%.
The report highlights that despite this growth, India's economic output remains 4% lower than its potential, primarily due to the COVID-19 pandemic and related disruptions such as supply chain issues and international military conflicts.
"Economies in South and Southeast Asia will see some of the strongest output gains this year," stated Moody's Analytics.
Regional dominance
APAC region outperforms in global economic growth
According to the report titled 'APAC Outlook: Listening Through the Noise,' the Asia Pacific region is surpassing other global regions in terms of economic growth.
Moody's Analytics projects that the APAC economy will expand by 3.8% this year, exceeding the global economic growth rate of 2.5%.
The report further highlights that India and Southeast Asia, despite suffering significant output losses due to the pandemic, are now commencing their recovery process.
Inflation concerns
Uncertain inflation forecast for India and China
Moody's Analytics has presented an uncertain inflation forecast for both India and China.
The report reveals that recent consumer price inflation rates in India have been around 5%, close to the upper end of the Reserve Bank of India's target range of 2 to 6%.
Stefan Angrick, Senior Economist, and Jeemin Bang, Associate Economist at Moody's Analytics, highlighted the lack of clear evidence of a trend toward slowing price pressures.
Inflation projections
RBI acknowledges uncertainties impacting inflation projections
The Reserve Bank of India (RBI) has acknowledged uncertainties surrounding food prices as a factor influencing inflation projections.
The RBI has set a 4.5% retail inflation projection for the fiscal year 2024-25 and warned about potential risks to commodity prices and supply chains due to ongoing geopolitical tensions.
For the June and September quarters, the RBI's inflation forecast is 4.9% and 3.8%, respectively, while the December and March quarters are projected at 4.6% and 4.7%.