The World Bank has revised India’s growth forecast for the current fiscal year from 6.6% to 7%. Industry leaders view this adjustment as a positive sign of India’s increasing resilience amidst global uncertainties.
Positive Economic Indicators
According to the World Bank, the Indian economy is maintaining robust growth, with a promising medium-term outlook. Sanjeev Agrawal, President of PHDCCI, commented, “The revised 7% growth forecast for 2024-25 is highly encouraging. Recent improvements in macroeconomic fundamentals such as inflation, the current account deficit, the fiscal deficit, and the debt-to-GDP ratio indicate that India’s strong growth trajectory will likely continue, outpacing other major economies.”
Future Growth Strategies
To sustain and enhance this growth, Agrawal emphasized the importance of reducing trade costs, lowering trade barriers, and reassessing Free Trade Agreements (FTAs). These steps are crucial for strengthening India’s position in the global market.
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Key Findings from the World Bank Report
The World Bank’s report, “India’s Trade Opportunities in a Changing Global Context,” reveals that India remains the fastest-growing major economy, with an impressive growth rate of 8.2% for FY23-24.
– Debt-to-GDP Ratio: Expected to decrease from 83.9% in FY23/24 to 82% by FY26/27.
– Current Account Deficit: Projected to stay around 1-1.6% of GDP through FY26/FY27.
Opportunities for Growth
India has the potential to further boost its growth by leveraging its global trade opportunities. The report suggests diversifying the export basket beyond IT, business services, and pharma to include textiles, apparel, footwear, electronics, and green technology products.
Enhancing Competitiveness
The report highlights that India’s competitiveness has been bolstered by the ‘National Logistics Policy’ and digital initiatives, which are helping to reduce trade costs and improve efficiency.
