India’s economy surpassed expectations with a robust growth rate of 8.4% in Q3 FY24, driven by high tax collections and subsidy management. The National Statistical Office (NSO) revised the FY24 growth estimate upward to 7.6%, aided by a downward adjustment of the FY23 estimate. With a nominal GDP projection of US$ 3.55 trillion (Rs. 294 trillion), this positive outlook facilitates the government’s path to achieving a revised fiscal deficit target of 5.8% of GDP for FY24. Despite a contraction in farm output, manufacturing and services sectors exhibited strong growth, with manufacturing sustaining double-digit growth for two consecutive quarters. However, private final consumption expenditure remained weak, while government spending contracted due to fiscal restraint. Nevertheless, robust double-digit growth in gross fixed capital formation indicates continued government capital expenditure. Analysts emphasize the importance of broad-based improvement in consumption and private investment for sustained GDP growth. Despite global challenges, exports showed positive growth, driven primarily by services exports. Overall, India’s economy demonstrates resilience and potential for sustained growth, with prudent fiscal management and strategic investment poised to drive future expansion.
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