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Below the Quote on GDP Data by Mahendra Patil, Founder and Managing Partner, MP Financial Advisory Services LLP

“India's FY24 GDP was revised up by 100 bps to 9.2% YoY, marking the highest growth in 12 years, excluding the post-COVID rebound. The Q3FY25 GDP growth stood at 6.2%, though slightly below consensus expectations, is a strong expansion despite a high base effect from 9.5% in Q3FY24.

Q3FY25 growth represents a significant rebound from the subdued Q2FY25 GDP growth of 5.4%, driven by increased government expenditure, higher private consumption during the festive season, and robust rural demand. Leading indicators such as the Index of Industrial Production (IIP) and Purchasing Managers’ Index (PMI) had already signaled an economic upswing compared to the previous quarter. Besides, Fiscal and Tax Collection Trends, as below supported the higher GDP scenario.

* Net tax collections as of February 12, 2025, stood at Rs.17.78 lakh crore, up 15% YoY, reaching 81% of the projected Rs.22.07 lakh crore target.

* GST collections for Q3FY25 reached Rs.5.46 lakh crore, marking a 6% increase QoQ and a 19% rise YoY compared to Q3FY24. Cumulative GST collections for the first nine months of FY25 (9MFY25) grew by 19% YoY, indicating broad-based economic activity.

The 6.2% GDP growth rate suggests a resilient and expanding economy, supported by strong consumption, increased government spending, and rising exports. Looking ahead, investment activity is expected to pick up, provided the lower interest rates are passed on, which should yield employment generation. Additionally, provided recent tax relief for the middle-income group boosts consumption further, we would see the continuing growth momentum in the coming quarters. However, global uncertainties such as escalated trade tariffs, Israel-Hamas and Russia-Ukrain conflict remain key factors to watch.”

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