RBI policy: India's real GDP growth for FY25 retained at 7.2%

The RBI Governor Shaktikanta Das proposed to transition CTS from the current approach of batch processing to continuous clearing.

India’s real GDP is expected to grow at 7.2 percent in FY25, Reserve Bank of India governor Shaktikanta Das said on August 8.

The monetary policy committee of the central bank decided to keep the repo rate unchanged at 6.5 percent by a majority of 4:2, Das said.

The MPC also decided to remain focused on withdrawal of accommodation stance by the same majority 4:2.

The central bank projected the real GDP for the first quarter of 2024-25 at 7.1 percent, for the second quarter at 7.2 percent, for the third quarter, there's a slight improvement at 7.3 percent, and for Q4, it is pegged at 7.2 percent.

While mentioning the real GDP growth, Das said that 'the risks are evenly balanced.'

Talking about India's growth story, Das said that capex thrust by the government coupled with robust balance sheets of corporates and banks will help in boosting the fixed investment activity in the country. He also said that there were clear signs of private investment picking up.

However, the volatility in the global financial markets, rising geopolitical tensions pose a challenge, Das added.

On consumption front, Das said that the improved farm activity has aided in better rural consumption. He also added that the urban consumption is improving.

It should be noted that the July Economic Survey, which was released before the Union Budget presentation had a more conservative growth rate of 6.5-7 percent majorly due to global tensions and some domestic challenges. Also, some major rating agencies such as ADB and IMF had had projected the growth at 7 percent.