S&P retains India's FY24 growth forecast at 6%, citing global economic slowdown, rising monsoon risks

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financial year 2022-23, India's growth rate came in at 7.2 percent, higher than the RBI's estimate of 7 percent. However, the pace of growth was slower as compared to the 9.1 percent recorded in FY22. Coming back to S&P, the rating agency retained its growth forecast for the current fiscal at 6 percent, S&P also maintained that India's economy will grow 6.9 percent in both 2024-25 and 2025-26 fiscal years.

Moreover, it added that India's consumption growth as well as capital expenditure remained "strong" in the June quarter. With regard to growth in the Asia Pacific region, S&P said it remains a "multi-speed region" and slightly raised its forecast for 2023 to 3.9 per cent amid domestic resilience. "In all, growth in the region has generally remained resilient.

Year-on-year GDP growth picked up in the second quarter in both developed and emerging Asian economies. India led again, with GDP growing 4.2 per cent quarter on quarter to a level 7.8 per cent up on a year ago," S&P said. Earlier on 20 September, India Ratings and Research revised India's GDP growth estimate for FY24 to 6.2 percent from 5.9 percent projected earlier, citing sustained government capex, deleveraged balance sheet of corporates and banking sector, and the prospect of a new private corporate capex cycle.