Moody's Analytics forecasts India's economy to grow by 6.1% in 2024

Moody's Analytics reported that India's output is currently 4% below what it would have been without the impact of the Covid-19 pandemic

Moody's Analytics has projected India's economy to expand by 6.1 per cent in 2024, a decrease from the 7.7 per cent growth recorded in 2023.

"Economies in South and Southeast Asia will see some of the strongest output gains this year, but their performance is flattered by a delayed post-pandemic rebound. We expect India's GDP to grow 6.1 per cent in 2024 after 7.7 per cent last year," Moody's Analytics said.

The report highlighted that India's output remains 4 per cent lower than it would have been without the Covid-19 pandemic and its various aftermaths, including supply disruptions and military conflicts abroad.

 

In its report titled 'APAC Outlook: Listening Through the Noise', Moody's Analytics said the region overall is doing better than other parts of the world.

The APAC (Asia-Pacific) region is faring relatively well compared to the rest of the world. The report forecasts 3.8 per cent growth for the APAC economy in 2024, in contrast to the global economy's 2.5 per cent growth.

Moody's Analytics further observed that both India and Southeast Asia have experienced significant output losses compared to their pre-pandemic trajectories, and their recovery is still in its early stages.

Regarding inflation, the report highlighted uncertainties for China and India. "Inflation in India is at the opposite extreme, with recent consumer price inflation rates hovering around 5 per cent, close to the upper end of the Reserve Bank of India's target range of 2 to 6 per cent and without clear evidence of a trend towards slowing price pressures," said the report.

Earlier in the month, the Reserve Bank of India (RBI) stated that uncertainties in food prices continue to influence the inflation outlook. The RBI maintained its retail inflation projection for the current fiscal year 2024-25 at 4.5 per cent.

Geopolitical tensions continue to pose risks to commodity prices and supply chains, said the RBI.

The central bank forecasted inflation rates of 4.9 per cent for the June quarter, 3.8 per cent for the September quarter, and 4.6 per cent and 4.7 per cent for the December and March quarters, respectively.