India 2024 Economic Survey Highlights
・Unfavorable weather in fiscal year 24 restricted food production. Tomato prices have risen due to region-specific crop diseases, early monsoon rains, and logistics disruptions. Onion prices soared due to rainfall during the previous year's harvest season which affected the quality of rabi onions, delays in sowing caliph onions, prolonged dry periods that affected production of caliph onions, and trade-related measures by other countries.
・Finance Minister Nirmala Sitharaman submitted the 2024 economic survey to the National Diet today. The survey predicted a real GDP growth rate of 6.5-7% in fiscal year 25, and the risks were balanced. Market expectations are high, highlighting the potential impact of rising geopolitical uncertainty on capital movements.
・The core services inflation rate in fiscal year 24 fell to a low level for the first time in 9 years, and at the same time, the core goods inflation rate also fell to a low level for the first time in 4 years. Durable consumer goods core inflation in fiscal year 24 declined due to an improvement in the supply of major input materials to the industry. This was a welcome change after durable goods inflation gradually increased from FY20 to FY23.
• Globally, in 2022, India's services exports accounted for 4.4% of global commercial services exports. Services exports maintained a steady momentum after the pandemic, accounting for 44% of India's total exports in FY24.
・India's electronics manufacturing sector has achieved remarkable growth since 2014 and occupied an estimated 3.7 percent of the global market share in fiscal year 22. Domestic production of electronic products increased significantly to ₹8.22 lakh crore, and exports increased to ₹1.9 lakh crore.
・The economic growth rate of 8.2% in fiscal year 24 was supported by an industrial growth rate of 9.5%. Among the four industrial subsectors, manufacturing and construction reached nearly double-digit growth rates, while mining and quarrying, and electricity and water supply also recorded significant positive growth in fiscal year 24.
・The agriculture sector recorded an average annual growth rate of 4.18% on a fixed price basis over the past 5 years. According to preliminary estimates for 2023-24, the agricultural sector's growth rate was 1.4% on a list price basis.
・Economic research: The short-term outlook is bright, but a clear long-term vision is necessary
Going forward, the Reserve Bank of India predicts that, assuming that the monsoon is as normal and there are no external shocks or policy shocks, the inflation rate will drop to 4.5% in fiscal year 25 and 4.1% in fiscal year 26. Similarly, the IMF predicts India's inflation rate of 4.6% in 2024 and 4.2% in 2025.
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乱空 OP : India's external debt ratio is extremely low, so currency depreciation is not a pain. Exchange rate fluctuations in India are the smallest among emerging market economies
India's inflationary pressure is under control
A sharp rise in the market capitalization ratio to GDP is not necessarily something to be happy about. The penetration of monetary policy is evident in mitigating core inflation. CEA Najeswaran says aggressive fiscal and monetary policy measures have suppressed deviations from inflation targets