India Fiscal Year GDP Growth

The Indian GDP is expected to grow 6.5% in the 2024/2025 fiscal year ending March 2025, marking the slowest pace of growth since the Covid pandemic drove the economy into a recession in the 2021/2022 year, but revised marginally higher form the initial estimate of 6.4%. The figure marks a sharp slowdown from the upwardly revised 9.2% growth rate from the earlier fiscal year, missing the ambitious expectations that were signaled by the government as higher energy prices and slower overall growth in Asian emerging economies magnified the impact of tight liquidity conditions stemmed from restrictive monetary policy from the RBI and the central bank’s effort to defend the rupee by intervening in foreign exchange markets.

India's economy is projected to grow by 6.4% in the 2024/25 fiscal year ending in March 2025, marking the slowest pace since the COVID-hit 2020/21 fiscal year and down from 8.2% growth in the previous year, according to preliminary estimates from the Ministry of Statistics. The figure also falls short of the government's earlier forecast of 6.5%. The slowdown is primarily attributed to weaker growth in gross fixed capital formation (6.4% vs 9%) and inventories (4.5% vs 5.9%), despite accelerated private (7.3% vs 4%) and government (4.1% vs 2.5%) spending. Additionally, exports grew at a faster rate (5.9% vs 2.6%), while imports contracted (-1.3% vs 10.9%). On the production side, manufacturing growth is expected to slow significantly (5.3% vs 9.9%), while growth in two other major GDP contributors - trade and hotels (5.8% vs 6.4%) and financial services and real estate (7.3% vs 8.4%) also moderated, offsetting a stronger performance in agriculture (3.8% vs 1.4%).