India's GDP growth to 'comfortably' exceed 6.5% in FY24, momentum to sustain in December quarter: Finance Ministry

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CNBC-TV18 quoted Finance Ministry as saying. The Finance Ministry said the momentum Indian economy gained in the second quarter of FY24 is likely to be sustained in the following December quarter of the fiscal year.

Apart from this, the ministry said that the growth in consumption demand is also expected to be sustained. Releasing the 'Half-Yearly Economic Review 2023-24' on Friday, the Finance Ministry mentioned that the real GDP grew by a healthy 7.7 percent in H1 of FY24, following a 7.6 percent growth in Q2.

Citing the reasons for growth, the ministry said that strong domestic demand for consumption and investment drove the GDP growth in H1 of FY24, while 'Private Final Consumption Expenditure (PFCE) registered a growth of 4.5 percent, with its share in GDP (Current Prices) increasing to 60.4 percent, the highest in H1 since FY12, barring the pandemic year FY21'. “The better-than-expected growth in Q2 of FY24 and the emergence of India as the fastest-growing major economy in H1 of FY24 have improved the growth prospects and prompted various domestic and international agencies to upgrade GDP growth projections for FY24," the government report said.

Sharing the key highlights of the review, the Finance Ministry said, "The relatively stable Indian rupee and adequate foreign exchange reserves generate optimism for India's external sector." In the half-yearly review report, the government while stating details on inflation said, "On the inflation front, with the stable downward movement in core inflation and continuing deflation in fuel inflation, the headline inflation outlook is on a declining trend, notwithstanding temporary disruptions from food prices. RBI has projected inflation to average at 5.4 percent in FY24." T