India's GDP growth may get close to 8%: RBI Governor Shaktikanta Das

Reserve Bank of India Governor Shaktikanta Das on Wednesday said the GDP growth for the current fiscal year ending March might surpass the 7.6% rate and may touch 8%. India's economy grew at its fastest pace in one-and-a-half years in the final three months of 2023, led by strong manufacturing and construction activity. Asia's third largest economy grew 8.4% in the October-December quarter, much faster than the 6.6% estimated by economists polled by Reuters.

"I would not hesitate to say that India’s GDP growth in FY24 will exceed 7.6%, it might be closer to 8%," Das said in an interview to ETNow.

Earlier, after the the Monetary Policy Committee's February meeting, Das said he believes India may grow at 7 per cent in the next financial year, i.e., FY25 as well. The MPC said each of the quarters in FY25 to grow at 7.2 per cent, 6.8 per cent, 7 per cent and 6.9 per cent respectively.

In its December meeting, MPC predicted Indian economy’s FY24 growth rate at 7 per cent. The Q3FY24 and Q4FY24 GDP growth rates were pegged at 6.5 per cent and 6.0 per cent while real GDP growth rate for Q1FY25, Q2FY25 and Q3FY25 were pegged at 6.7 per cent, 6.5 per cent and 6.4 per cent respectively.

On February 29, the government revised its growth estimate for the current fiscal year to March 31 to 7.6% from 7.3%.

Earlier in the day, ratings agency Crisil said the Indian economy will witness significant growth in the coming fiscal with a GDP growth rate of 6.8 per cent in the next fiscal year.

Crisil, in its India Outlook report, said the Indian economy will take support from domestic structural reforms and cyclical levers and can retain -- perhaps even improve -- its growth prospects to become the third-largest economy by 2031.

"After a better-than-expected 7.6% this fiscal, India's real GDP growth will likely moderate to 6.8% in fiscal 2025," said the Crisil India Outlook report.

At present, India's GDP size is $3.6 trillion. It is the fifth largest economy in the world, after the US, China, Japan and Germany. Crisil expects the economy to expand to $6.7 trillion by fiscal 2031.