India’s economic resilience and growth: Forvis Mazars in India’s macro-tracker series reveals steady real GDP growth of 8.2% to 7.8% in FY23-24

Bengaluru – July 18, 2024: India’s economic performance for FY23-24 has demonstrated remarkable resilience and strategic adaptability amidst global challenges and domestic opportunities, as unveiled by Forvis Mazars in India’s latest Macro-Tracker Series. The report highlights significant trends and data across key economic indicators, shedding light on the country’s robust economic trajectory. As per the report, India’s real GDP growth showcased a consistent performance in FY23-24, with Q1 at 8.2%, Q2 at 8.1%, Q3 at 8.6%, and Q4 at 7.8%. Real GDP growth peaked at 12.8% in Q1 of FY22-23, post which it starkly plummeted to 5.5% in Q2 and moderated at 6.2% in Q4.

Bharat Dhawan, Managing Partner at Forvis Mazars in India, emphasised, “The consistent GDP growth trajectory of India in FY23-24, highlighted by Q1 at 8.2%, Q2 at 8.1%, Q3 at 8.6%, and Q4 at 7.8%, underscores our nation’s resilience amid global challenges. Our Macro-Tracker series provides in-depth analysis across key economic indicators, revealing robust sectoral performances such as manufacturing’s growth at 9.9% and the mining sector’s expansion by 7.1% in FY24. This report reinforces our commitment to delivering strategic insights that support stakeholders in navigating dynamic economic landscapes.”

Steady GDP growth

India’s real GDP growth showcased a consistent performance in FY23-24, with Q1 at 8.2%, Q2 at 8.1%, Q3 at 8.6%, and Q4 at 7.8%. This marks a substantial improvement over the previous fiscal year’s volatile peaks and troughs, indicating a moderated but steady economic performance. The International Monetary Fund (IMF) projects India’s GDP growth to remain strong at 6.8% for FY24-25 and 6.5% for FY25-26, driven by robust domestic demand and a rising working-age population.

GVA and sectoral performance

The Gross Value Added (GVA) growth rates in FY23-24 also showed stability, starting at 8.3% in Q1 and maintaining growth at 6.3% in Q4. The manufacturing sector, which grew by 9.9% in FY24 compared to a contraction of 2.2% in FY23, and the mining sector, which grew by 7.1% in FY24 against 1.9% in FY23, significantly contributed to this stability.

Inflation and consumer price index

Inflation has been on a downward trajectory, stabilising at 4.8% in April 2024 from a peak of 7.4% in July 2023. The Consumer Price Index (CPI) reflects a gradual stabilisation in price levels, providing a conducive environment for consumer spending and economic stability.

International trade and foreign exchange reserves

FY24 concluded with the highest monthly merchandise exports of the fiscal year, totalling US$41.68bn in March 2024. Total goods imported in FY24 decreased by 5.66% to US$675.44bn. Foreign exchange reserves showed a gradual upward trend, reaching US$637.9bn in April 2024, indicating strengthening financial stability and increased buffer stocks to manage external shocks.

Fiscal performance and government expenditure

Net tax receipts for FY24 exceeded projections at IN₹23.27 trillion, while total expenditure stood at IN₹44.43 trillion, 99% of the budgeted amount. The fiscal deficit for April was 12.5% of the full-year target, highlighting the government’s fiscal discipline. GST revenue collections also saw significant growth, with April 2024 witnessing a collection of IN₹2.10 lakh crore.

The Reserve Bank of India (RBI) projects GDP growth of 7.3% for the June 2024 quarter, driven by continued public investment and robust consumer demand. The World Bank forecasts India’s growth to remain resilient at around 6.7% for FY25, supported by strong service exports and easing global commodity prices. Government interventions, including enhancing physical and digital infrastructure, boosting manufacturing sector competitiveness, and implementing financial sector reforms, are expected to sustain economic growth.

The Macro-Tracker Series by Forvis Mazars in India provides valuable insights into India’s economic resilience and growth, offering a comprehensive analysis of key economic indicators and trends shaping the nation’s economic landscape.