India’s Economic Outlook for FY24

October 17, 2023

The Federation of Indian Chambers of Commerce and Industry (FICCI) has released its Economic Outlook Survey for India, projecting key economic indicators for the fiscal year 2023-24.

Key Highlights

GDP Growth: India’s economy is projected to grow by 6.3% in FY24. The growth estimate ranges from a minimum of 6.0% to a maximum of 6.6%.

Agriculture and Allied Activities: The median growth forecast for agriculture and allied activities in FY24 is 2.7%, marking a moderation from the growth of about 4.0% reported in the previous fiscal year (2022-23).

Industry and Services Sectors: The industry sector is anticipated to grow by 5.6%, while the services sector is expected to grow by 7.3% in FY24.

Downside Risks: The survey identifies several downside risks to India’s economic growth, including geopolitical stress, slowing growth in China, the lagged impact of monetary tightening, and below-normal monsoons.

Inflation: The median forecast for Consumer Price Index (CPI) based inflation is 5.5% for FY24, with a range of 5.3% to 5.7%. Inflation remains uncertain, with upside risks due to sticky cereal prices, volatility in food prices, and rising crude oil prices.

RBI Policy Action: Economists expect a repo rate cut by the Reserve Bank of India (RBI) only by the end of Q1 or Q2 in the next fiscal year (2024-25).

Investments: The government’s focus on capital expenditure has boosted private investments, but a full-fledged recovery in private investments is expected to take more time. Recovery in private investments will likely be driven by increased consumption activity, both domestically and externally.

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