The Indian economy expanded by 6.2% in real terms during the October-December quarter of the 2024-25 financial year, according to data released by the Ministry of Statistics and Programme Implementation (MoSPI) on Friday. This growth rate surpasses the 5.6% recorded in the previous quarter (July-September 2024) but falls short of the Reserve Bank of India’s (RBI) forecast of 6.8%.
The latest GDP data indicates a moderate economic expansion, reflecting mixed trends in consumption, investment, and stock market performance. Despite missing RBI’s projections, India remains one of the fastest-growing major economies globally.
The Reserve Bank of India (RBI) had earlier projected real GDP growth for FY 2024-25 at 6.6%, with the economy expected to expand at 7.2% during the January-March 2025 quarter. However, the actual figures for the first two quarters of the financial year have lagged behind the central bank’s expectations.
Several factors have contributed to this slower-than-expected growth, including weak consumer spending, subdued corporate investments, and recent fluctuations in stock market performance. Analysts also point to global economic uncertainties and inflationary pressures that may have impacted demand in key sectors.
According to MoSPI estimates, India’s real GDP growth for FY 2024-25 is expected to be 6.5%, compared to 8.2% in 2023-24. This is 0.1% lower than RBI’s forecast of 6.6%. Meanwhile, nominal GDP is expected to grow by 9.7% in 2024-25, slightly higher than the 9.6% growth recorded in 2023-24.
Looking ahead, the Economic Survey presented on January 31, 2025, estimates that India’s economic growth for 2025-26 will range between 6.3% and 6.8%. This forecast underscores stable but moderate economic momentum in the near future.
Despite recent slowdowns, India has maintained its position as the world’s fastest-growing major economy. In 2023-24, GDP growth stood at 8.2%, following 7.2% in 2022-23 and 8.7% in 2021-22. These figures highlight India’s resilience and long-term economic potential, despite global and domestic economic challenges.
India’s strong services sector, rapid digital transformation, and government-led infrastructure investments continue to drive growth. However, experts emphasize the need for structural reforms in manufacturing, job creation, and policy frameworks to sustain long-term economic expansion.
The World Bank, in its latest assessment, stated that for India to achieve its goal of becoming a developed nation by 2047, the economy must sustain an average annual growth rate of 7.8% over the next 22 years.
However, achieving this ambitious target will require bold policy reforms, strategic investments in human capital, and the successful execution of economic policies. Key areas of focus include:
Enhancing workforce productivity through education and skill development
Boosting private sector investment and improving ease of doing business
Strengthening infrastructure and digital transformation
Addressing inflation and fiscal deficit concerns
Conclusion: A Promising Yet Challenging Road Ahead
India’s 6.2% GDP growth in Q3 2024-25 signals a steady yet slightly slower economic recovery compared to previous years. While the economy continues to outperform many global counterparts, domestic challenges such as sluggish consumption, investment constraints, and inflation risks remain key hurdles.
With RBI projecting a 7.2% growth rate for Q4 2024-25 and the government’s focus on economic reforms, the coming quarters will be crucial in shaping India’s long-term growth trajectory.