International Monetary Fund keeps India’s GDP growth forecast for FY25 unchanged at 7%
The International Monetary Fund (IMF) has maintained India’s gross domestic product (GDP) growth estimate at 7 per cent for the financial year 2024-25. At the same time, the GDP estimate for the financial year 2025-26 was also kept at 6.5 per cent.
Earlier in July, the IMF had increased India’s GDP growth estimate by 0.20 per cent to 7 per cent for the financial year 2024-25. The GDP estimate for the financial year 2025-26 was then 6.5%. Also in April, the IMF had given the same estimate for FY26.
The RBI maintained its GDP growth estimate at 7.2%
On October 9, the RBI had maintained its forecast for Indian GDP growth for FY25 at 7.2%. In August, the World Bank had increased its forecast for India’s GDP growth for the financial year 2024-25 from 6.6% to 7%. Then, the World Bank had said that in the last financial year 2024, Indian economy grew at 8.2%, which was the fastest.
What is GDP? GDP is one of the most commonly used indicators to track the health of the economy. GDP represents the value of all goods and services produced in a country during a given period. This also includes foreign companies that produce within the country’s borders.
There are two types of GDP There are two types of GDP. Real GDP and nominal GDP. In real GDP, the value of goods and services is calculated at the base year value or at a stable price. Currently, the base year for calculating GDP is 2011-12. While nominal GDP is calculated at current prices.
How is GDP calculated? A formula is used to calculate GDP. GDP=C+G+I+NX, here C means private consumption, G means public expenditure, I means investment and NX means net export.
Who is responsible for GDP fluctuations? There are four important drivers for increasing or decreasing GDP. The first is you and me. Everything you spend contributes to our economy. Second, the growth of private sector businesses. It contributes 32% to GDP. Third, there is public spending.
This means how much the government spends to produce goods and services. It contributes 11% to GDP. And fourth, net demand. For this, India’s total exports are subtracted from total imports, because India has more imports than exports, so its impact is negative on GDP.