Fitch raises India's GDP forecast to 6.3% for current fiscal year

Fitch Ratings has revised its economic growth projection for India in the current fiscal year 2023-24, increasing it from the previous estimate of 6% to 6.3%. The upward revision is primarily due to a stronger performance in the first quarter and positive momentum expected in the near future.

This forecasted growth rate of 6.3% is in comparison to the 7.2% expansion in GDP witnessed in the previous fiscal year 2022-23. During FY22, the Indian economy achieved a growth rate of 9.1%.

The rating agency highlighted the broad-based strength of India's economy, citing a 6.1% year-on-year increase in GDP for the first quarter of 2023 (January-March). Additionally, robust performance indicators such as auto sales, PMI surveys, and credit growth in recent months contributed to the revised forecast. Consequently, Fitch raised its projection for FY23-24 by 0.3 percentage points to 6.3%.

In March, Fitch had initially lowered its forecast for FY23-24 to 6% from 6.2% due to challenges posed by elevated inflation, interest rates, and subdued global demand.

Source: Media reports