The first advance real gross domestic product (GDP) growth estimate for FY25 has been maintained at 6.4 per cent, the Ministry of Statistics said on Tuesday. The estimate is significantly lower than 8.2 per cent growth in FY24 and is marginally below the Reserve Bank of India’s (RBI) projection of 6.6 per cent. During its previous Monetary Policy meeting, the RBI had projected India’s real GDP growth for FY25 at 6.6 per cent, with Q3 at 6.8 per cent and Q4 at 7.2 per cent. The real GDP growth in the first quarter of 2025-26 is projected at 6.9 per cent and the Q2 at 7.3 per cent.
The nominal GDP is projected to grow at 9.7 per cent, slightly higher than 9.6 per cent recorded in FY24. The revised growth figures suggest moderate economic expansion, high inflation, strained consumption, and external factors that may influence overall performance in the coming months.
In its official release, the Ministry of Statistics & Programme Implementation (MoSPI) said, “Real GDP has been estimated to grow by 6.4 per cent in FY 2024-25 as compared to the growth rate of 8.2 per cent in Provisional Estimate (PE) of GDP for FY 2023-24. Nominal GDP has witnessed a growth rate of 9.7 per cent in FY 2024-25 over the growth rate of 9.6 per cent in FY 2023-24.”
Per the release, the real GVA has grown by 6.4 per cent in FY25 over the growth rate of 7.2 per cent in FY24. Further, nominal GVA has shown a growth rate of 9.3 per cent in FY25 as compared to the growth rate of 8.5 per cent in FY24.
Despite a dull H1 of FY25, MoSPI expects an uptick in agriculture and allied sector with growth estimated at 3.8 per cent during FY25 as compared to the growth of 1.4 per cent witnessed during FY24.
The Construction sector and Financial, Real Estate & Professional Services sector are also expected to observe good growth of 8.6 per cent and 7.3 per cent, respectively during the FY25.
In terms of expenditure patterns, Private Final Consumption Expenditure (PFCE) at constant prices, has witnessed a growth rate of 7.3 per cent during FY25 over the growth rate of 4.0 per cent in the previous financial year. PFCE is a key indicator of domestic consumption, reflecting the spending behavior of households.
Similarly, the Government Final Consumption Expenditure (GFCE) at constant prices, has rebounded to a growth rate of 4.1 per cent as compared to the growth rate of 2.5 per cent in previous financial year. The uptick in government expenditure could be attributed to increased public investments in infrastructure, social programs, and welfare schemes.