In a surprising turn of events, India’s gross domestic product (GDP) growth for Q2 FY24 exceeded forecasts, reaching 7.6%, defying earlier projections of 6.8%. Reserve Bank of India’s governor, Shaktikanta Das, accurately predicted this positive outcome a month prior. The growth is attributed to robust monthly GST collections, a strong Index of Industrial Production (IIP), and impressive PMI figures.
The momentum continues as India solidifies its position as the world’s fastest-growing major economy. S&P Global Ratings’ recent report, “China Slows, India Grows,” forecasts India’s GDP to reach 7% by 2026, positioning it as the growth engine for South and Southeast Asia.
Despite global headwinds, Finance Minister Nirmala Sitharaman emphasized India’s resilience, citing the strength of its domestic market, purchasing power, and stable policies. Chief Economic Advisor V Anantha Nageswaran echoed this sentiment, attributing India’s bright economic prospects to government policies, including substantial capital expenditure and incentive schemes.
The noteworthy 7.6% GDP growth in Q2, following a robust 7.8% in Q1, marks a significant achievement, especially with a substantial contribution from India’s thriving manufacturing sector. With a 7.7% GDP growth in the first half of 2023-24, India is poised to outperform other major economies throughout FY24.
