Several media reports said on November 19, citing a purported screenshot of a live tracker of the GDP of all economies based on the international index, that India’s GDP crossed $4 trillion in nominal terms, making it the fourth-largest economy globally. International Monetary Fund data.
No official announcement was made until initial reports emerged.
“India, having achieved a massive GDP milestone of over USD 4 trillion, stands tall as a beacon of economic prowess and global influence. The country’s remarkable growth and development trajectory has not led to Not only did it raise living standards, but it also paved the way for a significant reduction in poverty rates.
“India’s economic narrative is one of resilience and promise. By embracing digital transformation, the country has harnessed the power of technology to drive financial inclusion, provide basic services, demonstrate high levels of transparency and governance, and champion women’s empowerment.
Here is the screenshot that several publications and netizens, including senior BJP leaders, are referring to.
While responding to the reports, Adani Group Chairman Gautam Adani said that the country will become the third largest economy in the next two years.
“Congratulations, India. Another 2 years to go before India becomes the third largest country by global GDP surpassing Japan with $4.4 trillion and Germany with $4.3 trillion. The tricolor wave continues! Jai Hind. (sic),” Adani posted on the platform Social media X.
Q2 GDP surprise
There is a “broad consensus” supported by economic expectations that real GDP growth in the second quarter will be better than the Reserve Bank of India’s forecast of 6.5 per cent, an article in the central bank’s report said. The November Bulletin said on November 16.
The Indian economy expanded by 7.8 per cent in the first three months of the fiscal year, and RBI Governor Shaktikanta Das recently expressed confidence in the domestic economy.
“Given the momentum of economic activity — some early data points have emerged — I expect the Q2 GDP numbers coming at the end of November will likely surprise to the upside,” Das said on October 31.
Optimism that real GDP growth will be above 6.5% appears supported by corporate results for the September quarter, the article said.
Analysts’ opinion
Standard & Poor’s Ratings on November 16 said India’s economic growth prospects should remain strong in the medium term, with GDP growing at 6-7.1 percent annually in fiscal years 2024-2026.
In a report titled “Global Banking Country-by-Country Outlook 2024,” Standard & Poor’s said that the banking sector’s weak loans will decline to 3-3.5% of total advances by March 31, 2025, on the back of structural improvement, including a healthy corporate balance. . paperwork, more stringent underwriting standards, and improved risk management practices.
The report said that global uncertainty will have less impact on the Indian economy.
Slowing global growth and external demand will affect economic activity and may lead to further inflation. She added that given India’s domestic orientation, the agency expects economic growth to be less affected.
“Economic growth momentum will continue. India’s economic growth prospects should remain strong over the medium term, with GDP growing at 6-7.1 per cent annually in fiscal years 2024-26,” S&P said.
Meanwhile, Morgan Stanley Research on November 13 said it expects India’s economic growth at around 6.5% for FY24 and FY2025, citing strong domestic fundamentals.
Domestic demand supported by strong corporate and financial sector balance sheets and pursuing policy reform measures will help India’s growth amid the global slowdown, the investment bank’s research arm said in its report on India’s economic outlook for 2024.
Recently, Moody’s Investors Service maintained India’s economic growth at 6.7% for 2023, citing the country’s remarkable resilience amid the global slowdown supported by strong domestic demand.
The IMF also raised its 2023-2024 growth forecast for India, to 6.3% from its July estimate of 6.1%, citing stronger-than-expected consumption during the first quarter.
The Reserve Bank of India (RBI) estimates growth at 6.5% for FY2024.
Government road map
The government’s roadmap to make India a $5 trillion economy includes measures such as focus on inclusive growth, strengthening digital economy, fintech, technology-led development, energy transition, climate action, and building on a virtuous cycle of investment and growth, the state minister said. . Pankaj Chaudhary told Finance in August.
Replying to an unstarred question in the Rajya Sabha, Chaudhary said key reforms like Goods and Services Tax (GST), Insolvency and Bankruptcy Code (IBC), significant reduction in corporate tax rate, Make India and startups in India. The strategies and Production Linked Incentive (PLIs) schemes, among others, will jump-start the growth of the Indian economy.
Chaudhary said the Union Budget 2023-24 has taken further steps to sustain the high growth of the Indian economy, which includes a significant increase in capital investment expenditure for the third consecutive year by 33 per cent to $10 lakh crore (3.3 percent of GDP).
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Updated: November 19, 2023, 04:05 PM IST