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BUSINESS & TRADE APRIL 04, 2025 | The Indian Eye 34

India GDP set to grow despite global

tensions as the worst of decline is

over for economy: Reports

Food inflation saw a sharp decline, driven by winter season correction in vegetable
prices, continued easing of pulse prices and various administrative measures

OUR BUREAU
continue to maintain a fine balance
New Delhi between fiscal consolidation, welfare
and growth.
he Indian economy is estimat- In the near full-year data avail-
ed to achieve a growth of 6.5
Tper cent in FY25 despite con- able for FY25, there is a close con-
vergence of actual deficits, critical ra-
siderable external headwinds, the
Monthly Economic Review by the tios, and essential expenditures with
their budget estimates, indicating a
Department of Economic Affairs sustained commitment to fiscal tar-
(DEA), Ministry of Finance has said. gets, the Monthly Economic Review
The Monthly Economic Review add- added.
ed that the performance of the econ- The Monthly Economic Review,
omy in the past quarters was driven however, recognized that the add-
by strong agricultural and service sec-
tor performance on the supply side ed that global trade continues to be
affected by uncertainty in the policy
and a steady increase in consumption environment.
and core merchandise and services Prime Minister Narendra Modi greets as he arrives at Rajya Sabha to attend the Budget ses-
exports on the demand side. sion of the Parliament in New Delhi on Thursday (ANI Photo/Sansad TV)
“Geopolitical tensions, trade The worst phase of India’s eco-
policy uncertainties, volatility in in- mates, kharif and rabi food grain out- nomic slowdown and earnings
ternational commodity prices and timates of agricultural production put is expected to rise by 6.8 per cent
suggest a positive outlook for food
financial market uncertainties pose inflation. and 2.8 per cent, respectively. decline is likely over accord-
considerable risks to the economic Union government finances ing to the global financial firm
growth outlook, globally and locally. As per the second advance esti-
One offsetting positive is the outlook Goldman Sachs. However, it ex-
for commodity prices. Domestic India’s GDP has doubled to $4.2 pects market volatility to con-
private sector capital formation, fo-
cused on India’s solid fundamentals trillion over last 10 years: IMF tinue in the near term because
and economic prospects, will be an of high domestic investment in
important driver of economic growth ndia’s Gross Domestic Product the world
in FY26,” the DEF said. (GDP) has doubled in size over At the same time, inflation small- and mid-cap stocks and
The review document added global uncertainties, particu-
that all sectors are estimated to grow Ilast ten years, according to the remains a crucial factor influenc-
ing economic conditions. The data
latest data released by the Interna-
close to their trend rates. The Inter- larly from tariffs.
national Monetary Fund, in its recent tional Monetary Fund (IMF). stated that the inflation in the
The data highlighted that the
Article IV report published in Febru- country’s GDP at current prices country is expected to remain at 4.1 “The worst is likely behind us in
per cent. The inflation rate is now
ary 2025, has stated that India’s pru- was USD 2.1 trillion in 2015 and in the central bank of the country terms of economic growth and earn-
dent macroeconomic policies and is expected to reach USD 4.27 tril- RBI’s targeted range of 4 to 6 per ings trajectory, and prices have cor-
reform-driven approach have posi- lion by the end of 2025, marking cent. Inflation remains a key indi- rected meaningfully,” it said.
tioned it as the fastest-growing major a 100 per cent increase in just ten cator to watch as it affects purchas- The report highlighted that the
economy, the monthly review added. years. ing power and the cost of living. NIFTY 50 index has corrected by 10
Retail inflation eased to 3.6 per per cent from its peak in September
cent in February 2025 on the back of The IMF also highlights that The IMF data also highlight- 2024. This decline was driven by a
recent benign price trends of food India’s real GDP growth rate for ed that the GDP per capita, which slowdown in earnings growth due to
the current year stands at 6.5 per
measures the average income of a
items. cent, indicating a strong and stable citizen based on the total economic weaker macroeconomic conditions
Food inflation saw a sharp de- and a sharp reduction in valuation
cline, driven by winter season correc- expansion of the economy. Real output, is estimated at USD 11,940 multiples across sectors.
tion in vegetable prices, continued GDP growth refers to the increase (or 11.94 thousand international Despite this optimism, the re-
in the value of goods and services
dollars in terms of purchasing pow-
easing of pulse prices and various produced in the country after ad- er parity). This indicates an im- port cautioned that risks remain, par-
administrative measures of the gov- justing for inflation. India is one of provement in individual prosperity ticularly from potential U.S. tariffs
ernment, the DEA added. the fastest growing economies in and living standards over the years. on Indian goods, which could impact
The DEA added that the es- trade and economic growth.

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