Indian economy continues to grow at healthy pace despite challenging global conditions: World Bank
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The World Bank in its latest ‘India Development Update: India’s Trade Opportunities in a Changing Global Context’ has said that the Indian economy continues to grow at a healthy pace despite challenging global conditions. But to reach its $1 trillion merchandise exports goal by 2030, India needs to diversify its export basket and leverage global value chains.
As per the India Development Update, India remained the fastest-growing major economy and grew at a rapid clip of 8.2 percent in FY23/24. Growth was boosted by public infrastructure investment and an upswing in household investments in real estate. On the supply side, it was supported by a buoyant manufacturing sector, which grew by 9.9 percent, and resilient services activity, which compensated for underperformance in agriculture.
It said reflecting these trends, urban unemployment has improved gradually since the pandemic, especially for female workers. Female urban unemployment fell to 8.5 percent in early FY24/25, although urban youth unemployment remained elevated at 17 percent. Going forward, the World Bank expects India’s medium-term outlook to remain positive, amid challenging external conditions.
According to the World Bank, the growth is forecast to reach 7 percent in FY24/25 and remain strong in FY25/26 and FY26/27. With robust revenue growth and further fiscal consolidation, the debt-to-GDP ratio is projected to decline from 83.9 percent in FY23/24 to 82 percent by FY26/27. It said that the current account deficit is expected to remain at around 1-1.6 percent of GDP up to FY26/27.
