Indian Economy to Grow at 7.0-7.1% in April-June 2024: SBI Research
The Indian economy is expected to grow at 7.0-7.1% in the April-June period of 2024-25, according to a report by SBI Research. This forecast comes just before the government releases the official data. The Reserve Bank of India (RBI) has projected a 7.2% growth for the entire year, with quarterly growth rates of 7.1% for Q1, 7.2% for Q2, 7.3% for Q3, and 7.2% for Q4.
SBI Research’s Ecowrap report, authored by Group Chief Economic Adviser Soumya Kanti Ghosh, highlighted the resilience of the Indian economy despite challenges like rising global freight costs and semiconductor shortages. The southwest monsoon has improved since early July, with cumulative rainfall 5% above the long-period average as of August 25, 2024. This has positively impacted agriculture, with the total kharif sown area reaching 103.1 million hectares, 2% higher than the same period last year.
India’s GDP grew by 8.2% in the financial year 2023-24, maintaining its status as the fastest-growing major economy. The economy grew by 7.2% in 2022-23 and 8.7% in 2021-22. Global rating agencies and organizations like the International Monetary Fund (IMF) have also raised their growth forecasts for India, with the IMF projecting a 7% growth for 2024.
On the global front, the SBI report noted that the economic outlook remains uncertain, but easing inflation has created room for monetary policy adjustments. At the Jackson Hole annual symposium, US Federal Reserve Chair Jerome Powell indicated that it might be time to reduce interest rates as inflation aligns with targets.
Doubts Revealed
SBI Research -: SBI Research is a part of the State Bank of India, which is one of the largest banks in India. They study and predict how the economy will perform.
Reserve Bank of India -: The Reserve Bank of India (RBI) is the central bank of India. It manages the country’s money and financial system.
Supply chain issues -: Supply chain issues happen when there are problems in the process of making and delivering products. This can slow down the economy.
Southwest monsoon -: The southwest monsoon is a seasonal wind that brings heavy rains to India, especially from June to September. It is very important for farming.
Global agencies -: Global agencies are organizations around the world that study and give advice on economic matters. Examples include the International Monetary Fund (IMF) and the World Bank.
US Federal Reserve -: The US Federal Reserve is the central bank of the United States. It controls the money supply and interest rates in the US.
Jerome Powell -: Jerome Powell is the Chair of the US Federal Reserve. He makes important decisions about the US economy.
Interest rate cuts -: Interest rate cuts mean lowering the cost of borrowing money. This can help boost the economy by making it cheaper to take loans.
Easing inflation -: Easing inflation means that the prices of goods and services are not rising as quickly. This can be good for the economy because it keeps things affordable.
