World Bank Upgrades India’s Growth Forecast to 7% for FY24-25

New Delhi, Sep 3 (KNN) In a notable revision, the World Bank has upgraded its growth forecast for India, projecting an impressive 7 per cent growth rate for the financial year 2024-25, up from its earlier estimate of 6.6 per cent.

This adjustment reflects the strong performance of the Indian economy, which stood out as the fastest-growing major economy in FY24 with an 8.2 per cent growth rate.

Auguste Tano Kouame, the World Bank's Country Director for India, attributed this optimistic outlook to India’s robust economic performance.

"India was the fastest-growing economy in FY24 at 8.2 per cent, and now it's growing at a good pace," Kouame stated.

Despite global growth remaining subdued compared to pre-pandemic levels, India’s economic resilience is drawing positive attention.

Looking ahead, the World Bank is optimistic about India's medium-term economic prospects, forecasting strong growth for FY26 and FY27.

Kouame emphasised the critical need for India to diversify its export basket and better integrate into global value chains to achieve its goal of USD 1 trillion in merchandise exports by 2030.

"India needs to diversify its export basket and leverage global value chains to reach USD 1 trillion in merchandise exports by 2030," he noted.

The report also forecasts a gradual decline in India's debt-to-GDP ratio, expected to fall from 83.9 per cent in FY24 to 82 per cent by FY27. The current account deficit is anticipated to remain stable, within the range of 1-1.6 per cent of GDP through FY27.

Kouame also praised India’s proactive approach to free trade agreements as a significant factor in its economic resilience. "India has had a proactive approach to free trade agreements," he remarked, noting that this strategy is bolstering India’s economic stability.

In addition to its existing strengths in IT, business services, and pharmaceuticals, Kouame suggested that India could further enhance its growth by expanding its export base into textiles, apparel, footwear, electronics, and green technology.

The World Bank’s revised forecast underscores strong confidence in India’s economic trajectory, driven by strategic policy initiatives and a commitment to expanding trade and exports.

(KNN Bureau)