The substantial growth, driven by strong domestic demand, is occurring amid a period of global economic slowdown and significant geopolitical instability. The recent quarterly GDP expansion of 7.6% from July to September has contributed to the positive outlook, following a 7.8% growth in the preceding quarter of June, resulting in a robust first-half growth of 7.7%.
Numerous agencies, brokerages, and research organizations have increased their growth estimates for the ongoing fiscal year, with many anticipating growth within the 6.7% to 7% range. If achieved, this would position India as the world’s fastest-growing major economy. In its recent monetary policy statement, the Reserve Bank of India (RBI) also revised its GDP growth projection to 7%, up from the previous estimate of 6.5%.
Unlike China, which is anticipated to experience a slowdown, India has become an attractive investment destination as Asia‘s largest economy grapples with various issues, including challenges in its previously booming real estate sector.
Multiple projections indicate that India’s economic growth narrative is poised to unfold robustly in the coming years, positioning it to become the third-largest global economy. Global ratings agency S&P has projected that India will be the fastest growing major economy in the world for the next three years. China’s growth has been estimated to slow to 5.4% in 2023 and to 4.6% in 2024 and edge slightly higher at 4.8% in 2025 before settling at 4.6% in 2026-dragged down largely by its property market woes and slowing demand.
S&P Global also sees a shift in regional growth patterns in Asia and expects Asia-Pacific’s growth engine to shift from China to south and Southeast Asia. While several challenges remain including a slowing farm sector, high youth unemployment and the upcoming national polls, India is poised to reap the benefits of strong growth for some years to come.(With TOI inputs)
