It is 0.2 percentage points up from the April outlook. For FY26, the forecast stands at 6.5%.
The projection is higher compared to both advanced and emerging economies. The global economy is expected to slow to 3.2% in 2024 from 3.3% in the year before.
“In India, the outlook is for GDP growth to moderate from 8.2 percent in 2023 to 7 percent in 2024 and 6.5 percent in 2025, because pent-up demand accumulated during the pandemic has been exhausted, as the economy reconnects with its potential,” according to the World Economic Outlook released on October 22.
The Reserve Bank of India forecasted a growth of 7.2% due to strong domestic demand earlier this month. The World Bank has also projected an expansion of 7% for India FY25.
The IMF report notes a slight downward revision of China’s growth forecast to 4.8%, even after the challenges in the real estate sector and low consumer confidence, attributing to “better-than-expected net exports”. On the other hand, Brazil and Russia’s economic output has been revised to 3% and 3.6% for 2024, respectively. It is also up for the United States to 2.8%.“The growth outlook is very stable in emerging markets and developing economies, around 4.2 percent this year and next, with continued robust performance from emerging Asia,” according to an IMF blog.
Emerging Asia includes China, India, Indonesia, Malaysia, the Philippines, Thailand, and Vietnam.
Manufacturing production is moving to emerging market economies, especially China and India, as advanced economies “lose competitiveness”, according to the IMF outlook.
Inflation for India is projected at 4.4% in 2024-25 and will fall to 4.1% in the following year.
India’s per capita output is projected to grow at 6% in FY25, higher than Brazil (2.6%), Russia (3.8%), China (4.9%), and the US (2.3%).