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India to leave other economies behind
In the next few years, India's economic growth could reach a whopping 8%. Shaktikanta Das, head of the Reserve Bank of India, shared these ambitious plans.
According to the regulator's forecast, the country's GDP could achieve steady growth in the range of 7.5% to 8% by 2025–2026. Das mentioned that in the medium term, the Reserve Bank’s monetary policy would depend on macroeconomic conditions and the dynamics of rising consumer prices.
Right now, the monetary policy softening is off the table. It is too early to talk about such a possibility, even though this is a trend among major central banks like the ECB, Bank of England, and Swiss National Bank. Still, these countries' rate cuts significantly affect the Reserve Bank of India's strategy. Nonetheless, the Indian regulator plans to stick to its own independent monetary policy. Das said that their decision was driven by internal factors.
At present, the Indian economy is considered one of the fastest growing in the world, a view frequently expressed by officials of the International Monetary Fund (IMF). The IMF predicts that by 2028, India’s contribution to global GDP will rise to 18% from the current 16%.
However, despite the positive forecasts, India's economic growth slowed down in 2024. The first quarter saw an increase of 8.2%, but from April to June, it fell to 6.7%. In this light, IMF analysts slightly adjusted their outlook, suggesting that India’s economic expansion might slow to 6.5% in 2025. Despite this, Indian authorities remain confident that in the medium term, the national GDP will grow at a faster pace than the global average.
Published 20 September 2024
© InstaFintech Group
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© InstaFintech Group
