Strong Agricultural Output and Employment Policies Drive Growth

The World Bank has significantly raised India’s economic growth forecast from 6.6% to 7% for the financial year 2024-25, attributing this optimistic revision to robust agricultural performance and effective employment policies. This projection is part of the South Asia Growth forecast report released on October 10, highlighting a surge in private consumption as a key driver.

Global Institutions Align on Positive Projections

India’s upward growth trajectory has gained consensus among various global rating agencies and multilateral organizations. In July, the International Monetary Fund (IMF) increased its growth forecast for India from 6.8% to 7%, reinforcing its position as the fastest-growing economy in the emerging markets sector. The Asian Development Bank (ADB) also echoed this sentiment in its September report, projecting a 7% growth rate for FY2024 and an even stronger 7.2% for FY2025.

Agricultural Growth Fuels Economic Resilience

The ADB attributes much of this growth to an above-average monsoon, which has led to increased agricultural output and bolstered the rural economy. This agricultural success is anticipated to enhance domestic demand and overall economic resilience, vital for sustained growth.

Reserve Bank of India Confirms Positive Outlook

In a separate but related update, the Reserve Bank of India (RBI) on October 9 projected the GDP growth rate for FY25 at 7.2%. RBI Governor Shaktikanta Das emphasized that strong quarterly performances across various sectors will support this optimistic forecast.

South Asia’s Growth Continues to Outpace Expectations

The World Bank also noted that economic growth in South Asia is expected to reach 6.4% this year, surpassing previous estimates and solidifying the region’s position as one of the fastest-growing globally. With these robust forecasts, India is set to continue its trajectory as a key player in the global economy.