Growth in India set to get more broad-based, says Morgan Stanley; pegged 6.8 pc for 2024

New Delhi [India], May 30 (ANI): Growth in India, which already is strong and surging, may become more broad-based across both on the consumer and business spending side, indicated Morgan Stanley.
The global investment bank, in its latest report '2024 Global Economic Midyear Outlook', attributed India's firm growth to three megatrends -- global offshoring, digitalization, and energy transition.

Morgan Stanley forecasts 6.8 per cent growth in 2024 (against RBI's 7 per cent), and 6.5 per cent the next, and thinks inflation will stay within policymakers' comfort zone.

Retail inflation clocked 4.83 per cent in April 2024, the lowest in the past 11 months. The retail inflation in India, though, is in RBI's 2-6 per cent comfort level but is above the ideal 4 per cent scenario. Inflation has been a concern for many countries, including advanced economies, but India has largely managed to steer its inflation trajectory quite well

"The stronger global growth we are predicting benefits India, leading to higher income from exports and supporting domestic capital spending," Morgan Stanley said.

In the report, the investment bank noted that there is potential for a faster-than-expected recovery in capital expenditures (which increased multifold in the past decade), driven by a stronger business environment and policy reforms.

India's GDP grew at a massive 8.4 per cent during the October-December quarter of the financial year 2023-24, and the country continued to remain the fastest-growing major economy. India's economy grew 7.2 per cent in 2022-23 and 8.7 per cent in 2021-22, respectively.

Fourth quarter data is expected later this week.

India's economy grew 7.2 per cent in 2022-23 and 8.7 per cent in 2021-22, respectively.

The size of India's GDP is currently ranked 5th, after the US, China, Germany, and Japan. It overtook the UK in 2022.

Just a decade ago, Indian GDP was the eleventh largest in the world. Currently, India's GDP is estimated to be around USD 3.7 trillion.

Citing various macroeconomic parameters that are doing pretty well, India's G20 Sherpa and former CEO of Niti Aayog Amitabh Kant projected that the country is all set to overtake Japan as the 4th largest economy in the world by 2025.

On Wednesday, S&P Global Ratings revised its rating outlook on India to positive from stable, and added that it expects continuity in economic reforms and fiscal policies regardless of the Lok Sabha election outcome.

"Our positive outlook on India is predicated on its robust economic growth, pronounced improvement in the quality of government spending, and political commitment to fiscal consolidation. We believe these factors are coalescing to benefit credit metrics," the global rating agency had said in a statement. (ANI)