Indian Economy: Global brokerage firm Morgan Stanley has revised its GDP growth estimates for India for the fiscal year 2024-25 (FY25), projecting a growth rate of 6.8 percent, up from its previous forecast of 6.5 percent. This upward revision is attributed to the sustained momentum in industrial and capital expenditure (capex) activities in the country.
Outlook for GDP Growth and Macroeconomic Indicators
For the fiscal year 2023-24 (FY24), Morgan Stanley maintains its GDP growth forecast at 7.9 percent. The firm anticipates GDP growth to hover around 7 percent in the March quarter of FY24, with Gross Value Added (GVA) growth projected at 6.3 percent. The report highlights expectations of broad-based growth in the coming fiscal year (FY25), with a narrowing gap between rural-urban consumption and private-public capex.
Anticipated Macroeconomic Stability
According to Morgan Stanley’s analysis, the growth trajectory is expected to be characterized by steady expansion, driven by improvements in productivity growth. The firm predicts macroeconomic indicators such as Consumer Price Index (CPI) inflation to stabilize at around 4.5 percent in FY25 and FY26, with the current account deficit projected to stand at 1 percent of GDP during the same period. This outlook suggests a favorable macroeconomic environment conducive to sustained economic growth in India.
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