Investments and festive boost to lift Q3 GDP: RBI
Indian economy, buttressed by North Block’s unwavering focus on productivity-boosting structural reforms, investments and ‘ebullient’ domestic consumption, is expected to expand faster in the third quarter than earlier estimated despite lingering growth concerns beyond home, the central bank said in its latest bulletin Thursday.
“Investment demand appears to be resilient with the government’s infrastructure spending, an uptick in private capex, automation, digitalisation, and indigenisation providing a boost,” the Reserve Bank of India (RBI) said.
India’s gross domestic product (GDP) expanded 7.8% in the first quarter of FY24, through which the RBI expects the economy to grow 6.5%. An ET poll of economists has pegged the second-quarter growth rate at 6.7%.
Several global economic think-tanks expect India to be the growth driver through this year and the next although global trade remains rather shaky, posing expansion challenges for several competing high-growth economies.
The RBI bulletin said the global economy is showing signs of slowing in the final quarter of 2023. By contrast, the pace of expansion in third-quarter GDP in India should be faster sequentially, with festival demand remaining “ebullient”.
The central bank now expects the economy to grow 6.3% in the third quarter (OctoberDecember), from 6% it estimated in the October monetary policy.
The RBI said that in urban areas, consumer appliances are in strong demand through the season, especially in the mid and premium segments. About four-fifths of consumer durable purchases are backed by consumer financing schemes spiced up with attractive equated monthly instalment (EMI) offers.
The entry-level segment demand is, however, relatively subdued as
