The Reserve Bank of India predicts a rebound in India’s growth path in the second half of FY25, driven by strong rural demand, a historic high in foodgrain production, and several other factors. According to the central bank’s monthly bulletin, continued government investment in infrastructure is expected to boost economic activity and encourage investments. Nevertheless, potential global challenges may pose risks to the evolving prospects for growth and inflation.
The RBI said: “India’s growth rate is set to pick up in the second half of 2024-25, driven primarily by resilient domestic private consumption demand. Supported by record levels of foodgrains production, especially rural demand, gains momentum.” is doing.”
The December bulletin featured an article discussing the current state of the global economy, highlighting its resilience with steady growth and contained inflation. According to high-frequency indicators (HFIs) for the third quarter of 2024-25, the Indian economy is showing signs of recovery after a slowdown in momentum during Q2. This recovery is attributed to strong festival activity and continued growth in rural demand.
India’s economic growth experienced a significant slowdown, reaching its lowest level in nearly two years, which has negatively impacted the overall outlook for the year. The country’s gross domestic product has grown by 5.4% in the third quarter of the current financial year compared to the same period last year.
The RBI indicated that India’s continued growth prospects are aligned with a more sustainable foundation, driven by positive climate initiatives such as renewable energy, electric vehicles (EVs), green hydrogen, and efforts to establish a carbon market.
