India’s macroeconomic outlook for FY24 is optimistic and supported by strong domestic fundamentals. • Investment demand is rising, and additional growth drivers include broad-based industrial growth and a thriving residential property market. Industrial capacity utilisation has improved, and increased demand for residential properties, combined with public sector capex, strengthens investment. Core inflation is steadily decreasing, and food inflation has eased, though notable challenges exist. Global inflation in 2023 was expected to decline due to the central bank’s tight monetary policies, but challenges arose from geopolitical uncertainties and volatile crude oil prices. Sluggish global demand impacts India’s trade, but recovery is projected in H2FY24. With a lower trade deficit and a comfortable forex reserve position, India’s external account appears robust. RBI’s forward-looking surveys on manufacturing, consumer confidence, employment, and inflation expectations yield optimistic results. Overall, in line with IMF projections, India is poised to remain the fastest-growing major economy in the world in FY24.
