The growth rate for April to June slowed to 6.7 percent, down from 7.8 percent in the first quarter, with sources predicting that this slowdown is primarily due to restrained government spending during the general elections.
During the April to June period, the general election for the lower house of Parliament was held, resulting in the re-election of Prime Minister Narendra Modi. According to Reuters, government spending was constrained by a provisional budget focused on fiscal consolidation, leading to an about 8 percent decrease in expenditure.
Inflation in India remains stable. The preliminary Consumer Price Index (CPI) inflation rate for July was 3.54 percent year-on-year, down from 5.08 percent in June. It has stayed within the Reserve Bank of India's target range of 2-6 percent for 11 consecutive months.
India's economy experienced negative growth in 2020 due to the impact of the COVID-19 pandemic. However, since 2021, high growth has continued, driven by population growth boosting demand. The real growth rate for January to March, as announced by the Indian government in May, was 7.8 percent, and the growth rate for 2023 was 8.2 percent.
According to the International Monetary Fund (IMF), India is projected to surpass Japan and become the world's fourth-largest economy by nominal GDP by 2025.
reporter
Kim Joo-heon
jhkim123@ajunews.com
