The World Bank has boosted its India growth forecast to 7% for the current fiscal year, up from 6.6% previously. This modification reflects a robust agricultural rebound and rising rural demand, according to the most recent India Development Update, which was released on September 3, 2024.
Ran Li, a senior economist at the World Bank, said that favourable monsoon conditions and increased private spending had led to the upward adjustment of India’s GDP prediction. Despite a challenging global climate, India’s growth is resilient, and the services sector is anticipated to maintain its robust performance. While there is a modest slowdown in the industrial sector, the recovery in agriculture is predicted to counterbalance this loss.
Furthermore, as agriculture recovers, rural private consumption is projected to increase.
The World Bank anticipates India’s medium-term growth rate to average 6.7% over the following two fiscal years, helped along by a slight increase in private investment that will aid in consumer recovery. However, obstacles continue, particularly in job creation, as the urban unemployment rate remains stubbornly high at 17%.
