Economists of the country’s largest bank, State Bank of India (SBI), have predicted that the country’s GDP growth will fall to 7.1 percent in the June 2024 quarter. In this way, SBI has also joined the groups that have expressed apprehension of a decline in the GDP growth rate. Earlier, global investment bank Goldman Sachs had cut India’s growth rate forecast for the financial year 2024-25.
State Bank economists have said in a report that the growth of Gross Value Added (GVA) in the April-June quarter of the current financial year will fall below 7 percent compared to last year to 6.7-6.8 percent. The report said, ‘According to our ‘nowcasting model’, GDP growth for the first quarter of FY 2024-25 can be 7.0-7.1 percent and GVA growth will be 6.7-6.8 percent. Real GDP growth was 7.8 percent in the June quarter last year and the March quarter before that. But this time many analysts are pointing to a slowdown in economic activity in the June quarter. This is due to the slowdown in the manufacturing sector and the reduction in spending by the central government due to the general elections.
According to the report, if banking, finance and insurance companies are excluded, in the first quarter of the current financial year, companies have registered a growth of only 5 percent in revenue while their operational profit has decreased by one percent. However, State Bank economists have maintained their 7.5 percent growth rate for the financial year 2024-25. This is higher than the Reserve Bank of India’s estimate of 7.2 percent growth.
