Good news for India

India decisively withstood global headwinds in 2023 and is likely to remain as the world’s fastest-growing major economy on the back of growing demand, moderate inflation, stable interest rate regime and robust foreign exchange reserves. Despite widespread pessimism witnessed among the developed nations and the worsening geopolitical situation, India recorded a gross domestic product (GDP) expansion of 6.1 per cent in the March quarter. The growth moved up to 7.8 per cent in the June quarter and was 7.6 per cent in the September quarter. For the first six months of this fiscal, the growth was 7.7 per cent. The growth momentum is expected to sustain in the December quarter, making India the fastest-growing major economy in the world much ahead of China. As per the latest growth projections of the Organization for Economic Cooperation and Development (OECD), which appear conservative, India will record a growth of 6.3 per cent in 2023, ahead of China and Brazil at 5.2 per cent and 3 per cent, respectively. For 2024, the OECD expects India to grow at 6.1 per cent and China at 4.7 per cent. On the other hand, major economies, including the US, UK and Japan, are likely to witness either deceleration or very nominal increase in economic growth rates in the coming year. India’s performance on the economic front in 2023 appears even better when viewed from a global perspective. As per the International Monetary Fund’s (IMF) World Economic Outlook, global growth is estimated to decelerate from 3.5 per cent in 2022 to 3 per cent in 2023 and further to 2.9 per cent in 2024. Ashima Goyal, Member of the Reserve Bank of India’s Monetary Policy Committee, said India’s growth has “shown great resilience despite many external shocks. This is due to increasing economic diversity and the role of policy in smoothing shocks”. Equipping people with better skills and assets, she said, “will add up to give India good growth in 2024 and beyond”.