The Indian economy is expected to achieve a growth rate of 7% or higher for FY24, with projections indicating continued growth in FY25 as well. If these projections for FY25 materialize, it will mark the fourth consecutive year of 7% or higher growth post-pandemic. This underscores the resilience and potential of the Indian economy, which bodes well for the future.
The global economy faces challenges in maintaining post-Covid recovery, including supply chain disruptions impacting trade flows, transportation costs, and inflation. However, having faced previous shocks, India expresses quiet confidence in weathering emerging disturbances. Emerging trends include the end of hyper-globalization in global manufacturing, challenges posed by Artificial Intelligence in services trade and employment, and the critical issue of energy transition, with a trade-off between economic growth and environmental sustainability. India is strategically navigating these challenges, emphasizing the need to lower logistics costs, invest in product quality, and transition to greener energy sources.
The Indian economy is better positioned to address these challenges due to policies adopted and implemented over the last decade, with historic infrastructure development and substantial public sector capital investment. The financial sector in India is robust, boasting a solid balance sheet, a willingness to lend, and double-digit non-food credit growth, excluding personal loans.
