India better placed to withstand global uncertainties: Shaktikanta Das

India is better placed to withstand global uncertainties amid a decelerating world tre, said Reserve Bank of India (RBI) Governer Shaktikanta Das. 

“ global ecomy continues to remain fragile. World tre is decelerating amidst a global tide of protectionism. Despite significant restoration of global supply chains, factors like elevated debt levels, lingering geopolitical hostilities, and extreme wear conditions aggravate risks to global growth and inflation outlook.”

RBI kept repo rate unchanged at 6.50 per cent in its four monetary policies, indicating a stance aimed at stabilising ecomic conditions.

central bank expects inflation trends to remain stey from October to December 2023 at 5.6 per cent, sustaining at 5.2 per cent for subsequent quarter until June 2024. However, a dip is expected by July–September 2024 to 4.0 per cent, followed by a marginal increase in final quarter to 4.7 per cent.

“We have w reached a st when every action has to be thought through even more carefully to ensure overall macroecomic and financial stability, more so because conditions ahe could be fickle. We have to remain vigilant and rey to act, as per evolving outlook. India is better placed to withstand uncertainties compared to many or countries,” said Das. 

Domestic growth

Das said that ecomic activity in country witnessed buoyancy in second quarter, led by strong domestic demand.

“Ecomic activity exhibited buoyancy in Q2, aided by strong domestic demand. GDP posted a robust growth of 7.6 per cent in Q2:2023-24, driven by investment and government consumption,” said Shaktikanta Das.

“Turning to Q3, two-thirds of rabi sowing has been completed despite late harvest of kharif crops in some states. manufacturing sector gained strength with easing input cost pressures and a pickup in demand conditions. Eight core industries recorded healthy growth in October and have continued ir high growth since June this year. purchasing manrs’ index (PMI) for manufacturing rose in vember. buoyancy of services sector has remained intact, as reflected in high-frequency indicators. GST collections at Rs 1.68 lakh crore in vember 2023 were buoyant. Services PMI displayed healthy expansion in vember,” he said.

GDP projections

Das also shared GDP projections, estimating real GDP growth for ongoing fiscal year at 7 per cent. Quarter-wise breakdowns revealed an anticipated 6.5 per cent growth in Q3 and 6 per cent in Q4. Looking ahe to FY25, Q1 is projected at 6.7 per cent, followed by Q2 and Q3 at 6.5 per cent and 6.4 per cent, respectively, with perceived balanced risks.

"Real GDP growth for current year 2023–24 is projected at 7 per cent, with Q3 at 6.5 per cent and Q4 at 6 per cent. Real GDP growth for Q1 of 2024–25 is projected at 6.7 per cent, for Q2 at 6.5 per cent, and for Q3 at 6.4 per cent. risks are evenly balanced," Goverr said.