Indian Economy Growth To Surpass Expectations – 8% in FY24

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As per SBI Research, the Indian Economy grew 7.4% in the final quarter of FY24 while the overall Indian economy growth registered for the financial year is likely to be around 8%. Investors are expecting the GDP data to be released for the Q4 FY24 and FY24 on May 31, by the central government. 

Earlier, RBI anticipated the India Q4FY24 GDP to be 7.3%, however, as per the SBI Research Report, the economy has already surpassed the same. 

Key Highlights of the Report

  • The report suggests uniform growth across rural as well as urban economies. The % of leading indicators showcasing acceleration in the economy stayed above 80 since January 2024. 
  • GST collection, airport passenger traffic, passenger vehicle sales, credit card transactions, toll collection, and petroleum consumption improved and pushed the growth in Urban India further. 
  • In Rural India, the diesel consumption picked up, and also the sales of two-wheelers. This is one of the major drivers for the growth in the rural landscape of the economy. 
  • Corporate GVA grew around 18% in the fourth quarter of FY24; however, it dropped on a YoY basis as well as a QoQ basis. In Q3FY24 the corporate GVA stood at 26% while for Q4FY23 it was at 20%. So, there has been a drop in both these levels. 
  • The sectors that drove the growth for the quarter that ended on March 31, 2024, include the Banking sector at the top, followed by the Automobile sector, pharmaceuticals, capital goods, consumer durables, and others. 

While the growth in Q4 FY24 is expected to surpass the earlier anticipations, the highest growth in the past six quarters was registered during the December 2023 quarter when the economy grew by 8.4%. However, the trend of economic growth depicts positive momentum in the economy. It displays that the financial landscape of the country is growing.

Global Economic Growth and Global Cues

The report also highlights the growth of the global economy, which remained stable for the period and the inflationary pressure came down. The employment conditions remained stable from the global perspective even when there was geopolitical turmoil going on and extremely poor weather conditions. 

The report suggests that global inflation to fall to 5.9% for FY24 from 6.8% recorded in FY23. 

What lies ahead?

As per RBI’s forecast, the Indian economy growth rate is expected to be around 7% in FY25; however, SBI Research predicts it to grow between 7.5% to 8% for the period. The global growth forecast for FY25 stands at 3.2% up from its FY24 growth has been recorded at 3.1%

As per IMF, the global inflation can go down to 4.5% in FY25, which can help the global economy as well as the domestic economy to boom. With the easing inflation figures, the hopes for rate cuts also increase, and so are the hopes of the investors. When interest rates fall, the inflow of money in the economy increases and the businesses boom. This leads to a surge in the equity market as well which can help the investors grow their wealth.


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