The IMF has kept India’s GDP growth estimate at 7% for the financial year 2024-25, while maintaining the estimate for 2025-26 at 6.5%.
Earlier in July, the IMF had raised India’s GDP growth estimate for the financial year 2024-25 by 0.20% to 7%. The estimate projected the GDP for the financial year 2025-26 to be 6.5%.At the same time, in April also, the IMF had given the same estimate for FY26.
RBI maintained GDP growth estimate at 7.2%
On October 9, the RBI maintained its estimate of India’s GDP growth for FY25 at 7.2%. At the same time, in August, the World Bank raised its estimate of India’s GDP growth for the financial year 2024-25 from 6.6% to 7%. Then the World Bank said that in the last financial year 2024, the Indian economy grew at a rate of 8.2%, which was the fastest.
What is GDP?
Economists often use GDP as a key indicator to track the health of the economy. GDP represents the value of all goods and services produced within the country in a specific period. It also includes foreign companies that produce within the country’s borders.
There are two types of GDP
GDP is of two types. Real GDP and nominal GDP. In real GDP, economists calculate the value of goods and services using the prices from the base year. Currently, the base year for calculating GDP is 2011-12. At the same time, nominal GDP is calculated on the current price.
How do we calculate GDP?
A formula is used to calculate GDP. GDP=C+G+I+NX, here C means private consumption, G means government spending, I means investment and NX means net export.
Who is responsible for the increase or decrease in GDP growth?
There are four important engines for increasing or decreasing GDP. First is you and me. Whatever you spend contributes to our economy. Second is the business growth of the private sector. It contributes 32% to GDP. Third is government expenditure.
This means how much the government is spending to produce goods and services. It contributes 11% to GDP. And fourth is net demand. To determine this, we subtract India’s total exports from its total imports. Since India imports more than it exports, this has a negative impact on GDP.
