S&P ELEVATES INDIA'S FY24 GROWTH FORECAST TO 6.4%

The agency forecasts India’s GDP growth at 6.4% for the current fiscal, slightly above other agencies, while RBI projects 6.5% growth for both this year and the next

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S&P Global Ratings adjusted India's growth forecast for the ongoing financial year to 6.4%, up from the previous projection of 6%, citing robust domestic momentum countering challenges from high food inflation and sluggish exports. Conversely, the estimate for the fiscal year 2024-25 was revised downward to 6.4% from 6.9%, anticipating a slowdown due to a higher base, global growth constraints, and the delayed effects of interest rate hikes.

In comparison to other international agencies like IMF, World Bank, ADB, and Fitch, S&P's forecast for India's GDP expansion in the current fiscal stands a bit higher at 6.4%. The RBI's growth projection aligns at 6.5% for both the current and following financial years.

India's economy exhibited a 7.2% growth in the 202223 fiscal year, bolstered by a 7.8% year-on-year increase in real GDP in the June quarter, up from 6.1% in the March quarter. However, the RBI's monetary policies have responded to curb inflation by raising benchmark interest rates by 250 basis points since May last year, holding the repo rate at 6.5% since February.