The higher-than-expected GDP growth print of 7.6 percent in July-September has forced many economists and agencies, including the Reserve Bank of India, to raise their full-year growth forecasts.
Against a backdrop of global economic volatility, the Indian economy presents a picture of resilience. The fundamentals of the economy remain strong, and the pre-election spending stimulus could potentially revitalise flagging consumption. But there are continuing worries around food inflation, and sluggishness in the rural output and services sector growth.
Extension of free foodgrain scheme and likely more such expenditure may not put India off the fiscal prudence roadmap, S&P said. The ratings agency also said Indias growth is likely to bounce back again to 6.9% in FY25 and stay around the level till FY27.
India growth outlook, India GDP: Fitch Ratings has raised India s medium-term potential growth estimate to 6.2%, attributing it to a swift recovery in labor force participation rates. However, Fitch has reduced the growth estimate for 10 emerging markets, including China, citing weaker employment and capital deepening prospects. Excluding China, the GDP-weighted average potential growth for EM9 improves to 3.2%