Indian economy expected to grow 5.9% in FY24, lower than RBI estimate: Report

New Delhi, Feb 22 (KNN) The India Ratings and Research in its latest report said that India’s economy is expected to grow 5.9 per cent in FY24, lower than the RBI’s estimate of 6.4 per cent.

India Ratings in the FY24 economic outlook released on Tuesday pointed out that GDP growth is projected keeping in mind factors such as normalising pent-up demand, headwinds for exports due to global growth slowdown, and credit growth facing tighter financial condition.

“Although there are a few positives for India such as – sustained government capex, deleveraged corporates, low NPA in the banking sector, Production-linked Incentive scheme and likelihood of global commodity prices remaining subdued, Ind-Ra believes they are still not sufficient to take the FY24 GDP growth beyond 6 per cent ,” Sunil Kumar Sinha, Principal Economist, India Ratings said.

As per the report, Private Final Consumption Expenditure is estimated to grow 6.7 per cent in FY24 from 7.7 per cent in FY23, but it may not lead to a broad-based consumption demand recovery because the current consumption demand is highly skewed in favour of the goods and services consumed largely by the households belonging to the upper income bracket.

“The goods and services of mass consumption have yet not shown a sustained pick-up,” it added.

The International Monetary Fund has projected the Indian economy to grow at 6.1 per cent in FY24 compared to 6.4 per cent estimated by the Reserve Bank of India.  (KNN Bureau)