On Wednesday, Shaktikanta Das, governor of the Reserve Bank of India, predicted that India's GDP will expand faster than 7.6% predicted in the central government's Second Advance estimate for the current fiscal year.
"I would not hesitate to say that India’s GDP growth in FY24 will exceed 7.6%, it might be closer to 8%," he added in an interview with ETNow.
Das stated his belief that India's GDP might increase by 7% in the next fiscal year (FY25), reiterating the prediction given at the Monetary Policy Committee's meeting in February.
We have 9.7 percent, 7.3 percent, and 7.1 percent. On average, it comes out to 8%. In addition, 7.6% could be closer to 8%. "The momentum is still going strong, so we are really looking forward to next year," Das continued.
Next year, we anticipate a growth rate of 7%. Our target remains 7%. As I speak with you, I would adhere to the 7% prognosis that we have made for next year," Das said, adding, "other forecasts have given considerably lower projections for next year." However, he will wait for the next MPC and our research teams to assess the situation.
Das was optimistic about the current quarter's results, predicting that India's growth might be closer to 8% for the year.
This quarter, we anticipate an implicit growth of 5.9%. The high-frequency indicators and the current pace of economic activity lead us to believe that this 5.9% might be surpassed, resulting in growth above 7.6%," Das stated.
"And I think there is quite a good chance of the growth, GDP number for the current year being very close to 8%," said the economist.
The 'Ecowrap' study report from the State Bank of India recently made a comparable assertion. As much as the third quarter GDP figures surprised some with good news, they startled the majority of market participants. According to SBI, "irrational expectations bordering fault lines" have no chance against the correct policy lenses and viewpoints.
Impressively, the Indian economy expanded by 8.4 percent in the third quarter of FY24, above experts' projections of 6.6 percent growth. However, some economists expressed concern over the moderated increase in gross value added.
The Governor of the Reserve Bank of India was asked about the central bank's inflation targets during his interview. He reiterated that the focus is on the 4% target and how to sustainably reach it.
Our current priority is bringing inflation down to the 4% target. "We would like inflation to sort of durably be around 4%," Das added, emphasizing that this cannot be a one-time achievement given the uncertainties we face, such as weather-related disasters.
It can't be a one-off or a monthly figure that hits 4%. It needs to be long-lasting and environmentally friendly at about 4%. That will boost our self-assurance, but we know exactly where to go. As Das pointed out, inflation is trending lower.
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