Global rating agency Moody’s has revised India’s GDP growth projection for the 2024 calendar year upward to 6.8%, compared to the earlier estimate of 6.1%. This increase is attributed to India’s strong economic performance in 2023 and a reduction in global economic challenges, as per a report by PTI citing Moody’s.

India’s economy surpassed analysts’ expectations by growing 8.4% during the October-December quarter. Moody’s credits this robust growth to the government’s capital spending and vigorous manufacturing activity.

Read More: India’s Economy to Remain Fastest Growing Among G-20 Economies

However, there’s a notable discrepancy between GDP and gross value added (GVA) growth rates. While GDP grew by 8.4%, GVA expanded by 6.5%. Economists suggest that this discrepancy is due to a sharp decline in subsidies, particularly fertilizer subsidies like Urea, during the quarter. Reuters reports a senior government official highlighting this factor.

Neelkanth Mishra, chief economist at Axis Bank, notes that this divergence between GDP and GVA is at a 10-year high. He doesn’t anticipate this trend to persist and predicts the economy to grow by 6.5% in the next financial year.

Read More : India’s Q3 GDP Skyrockets to 8.4%, Surpassing Expectations: Official Figures

India’s GDP growth for the fiscal year ending March 31, 2024, is estimated at 7.6%. @aditya for NewzQuest