Increasing Consumption and Strong Investment Demand to Drive India's GDP Growth, Shaktikanta Das

Das estimated the real GDP for Q2 FY25 at 7 per cent, Q3 at 7.4 per cent and Q4 at 7.4 per cent. The growth rate of real GDP of Q1 of the following year has been estimated at 7.3 per cent.

RBI Governor Shaktikanta Das on Wednesday projected that the real GDP for FY25 would be 7.2 per cent, with which global projections seem to be in sync- good fundamentals and rising consumption and robust investment sentiment in the country.

Das estimated the real GDP for Q2 FY25 at 7 per cent, Q3 at 7.4 per cent and Q4 at 7.4 per cent. The growth rate of real GDP of Q1 of the following year has been estimated at 7.3 per cent.

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On the third and the last day of the RBI's Monetary Policy Committee (MPC) meeting, Das said that the share of investment in the GDP has reached its highest level since 2012-13.

Looking ahead, the growth story of India remains intact as its fundamental drivers – consumption and investment demand – are gaining momentum," said Das.
On the supply side, GVA stood at 8 per cent and surpassed the GDP figure largely on account of an improvement in activities of industrial and services sectors.

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At this stage, highfrequency indicators available suggest that domestic economic activity remains steady and the mainstays in the supply side – agriculture, manufacturing and services remain resilient," said RBI Governor.

Das said that above-normal monsoons and better kharif sowing were lending an affirmative feel to agricultural growth. He further said the manufacturing activity would continue to gain with improving domestic demand, declining input costs, and an increasingly supportive policy environment.

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"Government consumption is improving, investment activity remains buoyant, government spending rebounding from a contraction in the first quarter, and private investment continues to gain steam," said the RBI Governor.

Households are "likely to experience a quicker pick-up in the second quarter of FY25 from here, the central bank said, with easing headline inflation and rural demand revival already underway".

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