Latest news with #Nageswaran
The Hindu
3 days ago
- Business
- The Hindu
Editors pick newsletter GDP growth at 6.5% in 2024-25, slowest since the pandemic
While a significant uptick in economic activity in the fourth quarter (Q4) of financial year 2024-25 pushed Gross Domestic Product (GDP) growth for the full year to 6.5%, as per the provisional estimates for 2024-25 released by the government on Friday, this is the slowest since the pandemic year 2020-21. As per data released by the Ministry of Statistics and Programme Implementation, real GDP growth in Q4 of 2024-25 accelerated to 7.4%, the fastest quarterly growth in the year. It was still slower than 8.4% growth seen in Q4 of the previous financial year. Quarterly GDP growth in Q3 stood at 6.4%. Chief Economic Adviser V. Anantha Nageswaran, in a press briefing following the release of the data, sought to downplay the post-COVID slowdown of the economy, saying that India has held its own in a 'growth-scarce' global environment. 'If you look in real terms, India's growth rate differential in comparison to the average growth rate of advanced economies was on the lower side during the 'boom era' between 2003 and 2010,' Mr. Nageswaran explained. 'The growth differential post COVID is higher than the growth differential in the 'boom era'.' 'In other words, in a growth-scarce environment post COVID and despite the rising uncertainties due to political conflicts and trade tensions, India is holding up its growth numbers better than many advanced economies,' he added. The agriculture sector continued its strong performance in Q4, leading to a relatively strong showing for the full year. The 'Agriculture, Livestock, Forestry & Fishing' sector grew 5.4% in Q4 of the year, up from 0.9% in Q4 of 2023-24. This helped propel the full year's growth for the sector to 4.6% in 2024-25, up from 2.7% in 2023-24. The manufacturing sector's growth stood at 4.8% in Q4 of FY25, the second fastest quarterly growth in the year, on a high base of 11.3% in Q4 of the previous year. The sector grew 4.5% in the full financial year 2024-25, down from 12.3% in 2023-24. The construction sector returned to double-digit growth of 10.8% in the fourth quarter, the fastest in the year, and faster than the 8.7% seen in Q4 of 2023-24. The sector's full-year growth stood at 9.4% in 2024-25, down from 10.4% in 2023-24. Growth in the tertiary sector — a composite of all the services sectors — stood at 7.3% in Q4, in line with the growth in Q2 (7.2%) and Q3 (7.4%). Growth in Q4, however, was slower than the 7.8% seen in the fourth quarter of 2023-24. In the full year 2024-25, the tertiary sector grew at 7.2%, lower than the 9% in the previous year. The data released on Friday also showed that growth in household consumption quickened to 7.2% in 2024-25 from 5.6% in the previous year. Gross Fixed Capital Formation, a measure of asset creation by the public and private sector, saw growth slowing to 7.1% in 2024-25 from 8.8% in 2023-24. This is despite growth in this spending quickening to a six-quarter high of 9.4% in Q4. For FY26, the Reserve Bank of India has cut India's growth forecast to 6.5% from 6.7% estimated earlier for the current financial year on account of impact of global trade and policy uncertainties. In another set of numbers, the Government has met its fiscal deficit target of 4.8% of GDP in 2024-25 though total receipts came in slightly lower than expected, as per data released by the Controller General of Accounts. The Centre's total revenue — counting tax, non-tax and capital receipts — came in at ₹30.78 lakh crore in 2024-25 or 97.8% of its revised estimates for the year. Total expenditure stood at ₹46.55 lakh crore, also 97.8% of the estimates. The fiscal deficit, the difference between total expenditure and total revenue, at ₹15.77 lakh crore, stood at 4.8% of GDP based on the latest provisional estimates for the year. As part of the Centre's fiscal consolidation glide path, Finance Minister Nirmala Sitharaman had, in Budget speech in February, targeted fiscal deficit of 4.4% of GDP for FY26. Closer examination of the data show total revenue fell short of the revised estimates due in large part to a shortfall in miscellaneous capital receipts, that includes disinvestment proceeds. There was also a minor shortfall in tax revenue. The Centre earned ₹17,202 crore as miscellaneous capital receipts or just 52.1% of revised estimates for FY25. Department of Investment and Public Asset Management data show the government earned ₹10,131.32 crore via disinvestments in 2024-25. Corporate tax collection at ₹9.87 lakh crore in FY25 was 0.7% higher than revised estimates. Income tax collections, on the other hand, at ₹11.83 lakh crore were almost 6% lower than revised estimate. The Hindu's Editorials The Hindu's Daily Quiz Which of the following States has been under President's rule since February 13? Assam Meghalaya Manipur Nagaland To know the answer and to play the full quiz, click here.
Mint
3 days ago
- Business
- Mint
Indian economy ‘doing quite well', may grow up to 6.8% in FY26, driven by FDI, urban spending: CEA Nageswaran
Chief Economic Adviser (CEA) Anantha Nageswaran said that the Indian economy is performing well and may achieve a growth rate at the upper end of its 6.3-6.8 per cent projection, provided there are continued measures to promote foreign direct investment and an increase in capital investment by the private sector, along with boosted urban consumption. "All in all, given the global environment, our economy is doing quite well," the CEA told reporters on Friday at a virtual press conference after GDP data for 2024-25 and January-March were released. 'And if we continue with the efforts to bring in more foreign direct investment and the private sector, if it continues its increase in capital investment, which we saw in 2024-25 and urban consumption picks up on the back of let's say, better capital formation, hiring and compensation, then we can probably achieve a growth rate which is at the higher end of this range (6.3-6.8 per cent),' he added. The Indian economy grew by 6.5% in real terms for FY25, aligning with expectations. As per the second advance estimates of National Statistical Office (NSO), the Indian economy was projected to grow at 6.5 per cent in 2024-25. The Reserve Bank of India (RBI) estimated 6.5 per cent GDP growth for the fiscal year 2024-25. Notably, India's GDP grew by 9.2 per cent in FY24, while the economy grew 7.2 per cent in FY23 and 8.7 per cent in FY22. The government also released the official GDP growth data for the January-March quarter on Friday. The economy grew 7.4 per cent for the quarter ended on March 31, 2025. Meanwhile, the growth rate of the Indian economy in the April-June, July-September, and October-December 2024 quarters stood at 6.7 per cent, 5.6 per cent, and 6.2 per cent, respectively. Speaking on the impact of the unusual onset of monsoon and its impact on the vegetable prices, Nageswaran said, 'To say there will be a problem as of now, I think every indication is that crop produce will be good and with adequate inventory, the benign food price trends will continue.' Monsoon rainfall is expected to be above normal in India, particularly in India's key rain-fed agricultural belt, as per IMD. Additionally, monsoon arrived early in several states this year. CEA stated that global growth for 2025 and 2026 is expected to be slow amid the global uncertainties. However, the forecast cuts will be smaller for India in the global cuts. Speaking on inflation, he further said that food inflation is likely to remain low due to a good harvest and above normal monsoon. 'Food Inflation remains benign due to good rabi harvest, higher summer sowing, healthy procurement, and above-normal monsoon. Exports remain robust, forex reserves provide 11 months of import cover. Declining crude oil prices will potentially lower import bills, create fiscal space and alleviate external economic pressures,' CEA said. The government maintains its outlook for 2025-26 growth at 6.3-6.8 per cent, driven primarily by private consumption, particularly the rural rebound, and growth in services exports. Various agencies have projected India's growth to fall within the range of 6.3-6.7 per cent for 2025-26. (With inputs from agencies)
Time of India
3 days ago
- Business
- Time of India
7.4% GDP growth in Jan-Mar pushes FY25 figure to 6.5%
Representative image NEW DELHI: India's economy grew faster than expected at 7.4% in the Jan-March quarter, led by robust growth in agriculture and construction. The strong quarterly showing - the fastest in the fiscal year - pushed overall growth in 2024-25 to 6.5%, according to data released by the National Statistics Office. The Jan-March figure outperformed the upwardly revised 6.4% in the Oct-Dec period, and pointed to robust momentum in the fourth quarter amid global uncertainty. India remained the fastest growing major economy in the March quarter, followed by China at 5.4% and Indonesia at 4.9%. The full-year growth estimate was in line with expectations and the second advance estimate, but the lowest in 4 years, on the back of 9.2% expansion in the previous year. Chief economic adviser V Anantha Nageswaran Friday said robust domestic demand has supported GDP growth and private consumption share has risen to the highest level since FY04. "Govt retains its outlook on FY26 growth at 6.3-6.8%, with private consumption, especially the rural rebound, and resilient services exports as the key drivers," Nageswaran said in a presentation after the data was released. Multiple agencies project India's growth to be in the range of 6.3-6.7% this year, he said. The Jan-Mar quarter data showed the farm sector remaining robust with growth of 5.4% while the construction sector grew 10.8% in the same period. The services sector remained steady at 7.3% in the March quarter compared with an expansion of 7.8% in the same year earlier quarter. The 6.5% growth for 2024-25 was attributed to a pickup in private consumption and investment while the acceleration in investment demand led to the sharp jump in the fourth quarter performance. "In line with expectations, real GDP registered 6.5% growth in fiscal 2025, elevating the Indian economy's size to $3.9 trillion from $3.6 trillion in fiscal 2024," said DK Joshi, chief economist at ratings agency Crisil. "Consumption growth outpaced GDP, primarily driven by robust rural demand supported by a strong agricultural sector. A sharp catchup in investment growth in the last quarter also brought investment growth above GDP growth. ... Net net we expect India's GDP to grow at 6.5% in fiscal 2026 with risks tilted downwards," said Joshi. Stay informed with the latest business news, updates on bank holidays and public holidays . AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Economic Times
3 days ago
- Business
- Economic Times
India's growth remains intact despite global gloom: CEA backs resilient demand, rising consumption
CEA Synopsis Despite a slowdown in full-year economic growth to 6.5%, India's CEA remains optimistic, citing robust Q4 growth of 7.4% driven by strong industrial output and resilient consumption. The nation's steady capital goods imports, infrastructure output, and FDI inflows support a healthy investment climate. India is well-positioned to navigate global turbulence with strong domestic demand. Despite a marked slowdown in full-year economic growth, India's Chief Economic Advisor (CEA) V. Anantha Nageswaran remains confident in the country's growth trajectory, underlining its resilience in the face of mounting global uncertainties. 'It's not just the growth number but how India's growth is holding up in a difficult global environment that matters,' he stated following the release of the Q4 and FY25 GDP data. ADVERTISEMENT India's GDP growth for FY25 slowed to 6.5%, a four-year low compared to the post-pandemic high of 9.2% in FY24. Yet, Q4 growth surged to 7.4%, exceeding expectations and signaling robust economic momentum driven by strong industrial output and resilient consumption, particularly in rural areas. This quarterly performance helped the economy maintain its status as the fastest-growing major economy globally. 'We are retaining our FY26 growth forecast at 6.3–6.8%,' said Nageswaran, highlighting steady capital goods imports, a rise in infrastructure output, and stable gross FDI inflows as signs of a healthy investment climate. He noted that while global growth is expected to slow, India has seen 'smaller forecast cuts' relative to peers. Private consumption, now at its highest share of GDP since FY04, rose 7.2% year-on-year, buoyed by rural demand and urban income-tax relief. The services sector and exports also continued to show resilience amid global trade tensions and escalating geopolitical risks. Agricultural output provided a surprise upside, with FY25 growth at 4.6%, more than double the previous year.'Urban unemployment is coming down, and both urban and rural demand remain steady,' the CEA added, pointing to signs of a benign growth-inflation environment that could support future rate easing. The external sector, he said, is benefiting from strong services exports and steady merchandise volatile foreign portfolio investment (FPI) trends, Nageswaran emphasised the need to boost FDI inflows further in light of shifting global supply chains. 'We must redouble efforts to attract FDI. Globally, we are in a growth-scarce environment,' he cautioned. ADVERTISEMENT While private investment remains cautious due to global uncertainties, the CEA affirmed that India's domestic demand-driven economy continues to provide a strong foundation for growth. With supportive macroeconomic conditions and sustained consumption momentum, India remains well-positioned to navigate global turbulence. (You can now subscribe to our Economic Times WhatsApp channel) (Catch all the Business News, Breaking News, Budget 2025 Events and Latest News Updates on The Economic Times.) Subscribe to The Economic Times Prime and read the ET ePaper online. NEXT STORY
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Business Standard
3 days ago
- Business
- Business Standard
Growth momentum to continue in Q1FY26 as India outshines key economies: CEA
India's FY25 GDP growth print of 6.5 per cent shows that the country continues to outperform many of the world's larger and key economies. Growth in FY26 is expected to be between 6.3 and 6.8 per cent, driven by private consumption, a rural rebound, and resilient services exports, Chief Economic Advisor (CEA) V Anantha Nageswaran said on Friday. The CEA noted that if urban consumption picks up on the back of stronger capital formation, increased hiring, and improved compensation, India could reach the upper end of this range in FY26. He said the income tax relief announced in the Budget for FY26 will support consumption, and that high-frequency indicators for April 2025 show robust industrial and commercial activity. 'It's important to understand that globally, this is a growth-scarce environment. In spite of rising uncertainties due to geopolitical conflicts and trade tensions — which predate 2025 — India is holding up its growth numbers better than many advanced economies,' the CEA said. 'Interest rate moderation by the RBI and the tax relief provided by the government are expected to boost overall consumption. Capital formation by the private sector is also likely to improve, as capacity utilisation levels are high,' he said. On private sector investments, the CEA remarked that it is not as though private capex has been stagnant — but the growth rate has remained on the slower side. 'Given that India has a large domestic economy, the private sector can definitely invest more. But how much it will ramp up in this current environment is difficult to say,' he added. Nageswaran highlighted that while the external environment does not pose a funding risk for India, the country must increase its efforts to attract foreign direct investment (FDI) by integrating more deeply into global supply chains and leveraging the 'China plus one' strategy. He also said that declining crude oil prices could lower the import bill, create fiscal space, and ease external economic pressures. However, he warned that renewed financial market volatility could bring additional uncertainty, potentially weighing on growth. 'Diverging central bank rate paths globally may impact capital flows and financial markets,' Nageswaran said.
