Economists see India’s GDP growth slowing in second half of FY24

Posted under: MSME
Date: 2023-11-30
Economists see India’s GDP growth slowing in second half of FY24

While India is poised to maintain its status as the world's fastest-growing economy, there are expectations of a slowdown in GDP growth in the second half of the current financial year. The first half of FY24 saw robust economic performance, with a 7.8% year-on-year GDP growth in Q1 and an anticipated 6.8% growth in Q2 based on high-frequency indicators. Public investments in infrastructure drove economic activity, supported by strong consumption demand. Economists anticipate challenges in the second half, including export headwinds, higher interest rates, tighter consumer loan funding, and weaker agricultural output due to El Nino. Ratings & Research predicts 5.0-5.5% growth in H2FY24, driven by urban demand, passenger vehicle sales, online food deliveries, airline traffic, and hotel occupancies. Rural demand faces challenges from El Nino, crop shortfalls, and rabi crop risks, causing a slowdown in Q2 FY24. Despite fragility, India's economic resilience remains significant.

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