India's Economic Growth Likely To Rebound To 6.7 Per Cent In Second Half Of FY25: JP Morgan

India's GDP growth is expected to rise to 6.7 per cent in the second half (H2) of the fiscal year, pushing the overall growth rate for 2024-25 to 6.4 per cent, according to a J P Morgan report.

The country's GDP grew by 5.4 per cent during the July-September 2024 quarter, registering its slowest pace in seven quarters and falling well short of market projections.

The slowdown in GDP growth was driven by cyclical factors and a weaker-than-anticipated performance in consumption, investment, and exports.

The report noted that the third-quarter slowdown was not entirely unexpected, as the economy had been showing signs of cooling in recent months, ANI reported.

Core Gross Value Added (GVA), excluding sectors like agriculture, public administration, and subsidies, fell sharply to 5.3 per cent—the lowest in seven quarters.

Nominal GDP growth dropped to 8 per cent, marking its weakest performance since December 2020.

"We expect growth to average about 6.7 per cent in the second half of the fiscal year, taking full-year 2024-25 GDP growth to 6.4 per cent," the JP Morgan report stated, citing factors that could boost growth in the coming quarters.

Looking ahead, the report noted that a more stable government capital expenditure (capex) plan, coupled with continued rural consumption growth and a more favourable global environment for services exports, could support growth in the coming quarters.

However, the report cautioned that urban consumption and merchandise export challenges would need careful attention as India progresses through the latter half of the 2024-25 fiscal year.

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