Nominal GDP growth may be pegged at 10.7%: Economists

THE INTERIM BUDGET for 202425 could peg the country's nominal GDP growth for the next financial year at 10.7% or thereabouts, going by the median of a poll of 15 economists. The estimates for nominal GDP growth for the next fiscal range from 9.5% to 11.3%, with most economists expecting the figure at 10.5%.

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"With the base effect propping up wholesale inflation, nominal GDP growth could be higher in FY25," said Sakshi Gupta, principal economist, HDFC Bank. Gupta sees real GDP growth at 6.3% in FY25, and CPI and WPI inflation at 4.7% and 6.5%, respectively.

The nominal GDP assumption holds significance as based on this estimate the Budget pegs its fiscal deficit target for a financial year.

In the current year, the Budget had assumed nominal GDP growth at 10.5% and fiscal deficit at 5.9% as percentage of GDP.