00:00We have some news coming in from the business sector.
00:02S&P Ups India, financial year 27 growth forecast about 40 BPS to 7.0%.
00:10Seeing 25 BPS rate hike, informists we are told,
00:13the S&P Global Ratings on Wednesday raised India's GDP growth forecast
00:18for 26-27 April-March by 40 BPS, 40 basis points, to 7.0%.
00:25That's a good number.
00:26The rating agency has revised its growth projections upward
00:30considering robust industrial activity, healthy exports,
00:34government support seen during the first quarter of the financial year.
00:38We are told that economists at the S&P Global also are expecting
00:42the Reserve Bank of India's rate-setting panel to hike the repo rate by 25 basis points
00:47to 5.50% in the financial year 27.
00:51Let me just take you back to last month.
00:53If you remember, S&P Global saw India's growth at 6.6% for the current financial year.
00:58So the latest growth projection is at least 30 basis points higher
01:01and the Reserve Bank of India's projection of 6.7% growth even.
01:06So it's crossing that expectation as well.
01:09The World Economic Forum estimating the country's growth in financial year 27 at 6.7%.
01:14Moody's projected it at 7.0%.
01:16India's GDP grew at 7.8% in financial year 26.
01:22Several factors drove growth to higher levels than we expected in the June quarter.
01:26S&P Global said in the report that these include robust industrial activity,
01:30healthy consumption, strong goods exports and accelerating government investment.
01:34So that is the latest that we have.
01:37What it means basically is looking at the movements that are happening,
01:40whether it's industrial, off-economy and the kind of estimated effort that is being put in,
01:46what will that result in?
01:487.0 is where S&P Global has put India's growth forecast for the financial year 2027
01:55and that basically focuses on industrial activity and healthy exports.
01:59But remember, this also comes at a time that India is battling, for example, the US tariffs
02:04or the global war that is happening, which other countries are also getting affected by,
02:10even if they're not part of the West Asia conflict, Russia-Ukraine conflict as well,
02:15which may be country-specific, but it is impacting other countries as well.
02:19Amid all of that, if India has managed to push through, just like it did during the COVID pandemic,
02:24it could be not just benefiting domestic interests, but the world is going to take note of how that is
02:30really worked out.
02:31So right now, what we know is that S&P Global has increased the basis points
02:36and has raised India's GDP growth forecast for 2627 year by 40 basis points to 7.0%
02:44and are revising their own growth projections upward,
02:47considering the industrial activity, health exports and government support.
02:55And it's interesting because S&P Global witnessed India's growth, remember, at 6.6% just last month.
03:02So their projection itself is also 30 basis points higher.
03:05They are even higher than Reserve Bank of India's projection of 6.7% growth.
03:10So these are, remember, independent organisations that are talking about India and its growth at a time.
03:17Of course, there are several issues that India faces internally as well.
03:20It will have to look at that consistently.
03:23But at least when it comes to economy and its stability, remember, India, given its own resources crunch or other
03:31issues,
03:31it may be battling, but has managed to stay afloat when even the Western nations have suffered immensely.
03:39European nations have had a lot of concerns when it comes to economy fall.
03:45The USA has been battling it, especially because of its involvement, whether in Russia-Ukraine war or the West Asia
03:51war,
03:52has gotten gulped vis-a-vis its economy as well.
03:55But several factors that drove growth to higher levels than S&P Global expected in the June quarter.
04:01They are saying in this report, and I quoted, that healthy consumption, strong good exports, industrial activity and accelerating government
04:09investment
04:10is the reason that they have given a 7.0% growth forecast for India's economy financially at 26-27.
04:19That is of one quarter, and that is about, we are told, April-March basically is what they are looking
04:25at.
04:25But that is definitely a good news.
04:27Let's say India and hope that India can stay afloat with that growth boost.
04:31Because remember that the IMF also had said that when all the countries were facing a downturn during the COVID
04:38pandemic,
04:39on the dark horizon, the spot of light was of India during the corona pandemic,
04:48which had clearly led to massive economy issues across the world.
04:52And even right now, when we are looking at a certain recession of a certain kind,
04:57restrictions that have even been advised by Prime Minister Modi,
05:00looking at the regional conflicts around us.
05:03However, remember, India has been battling not just the world issues,
05:07but our own neighbours that have caused us trouble,
05:10our internal issues, all of that and more.
05:13And still a developing nation, India has managed to stay afloat.
05:17It is no ordinary achievement, ladies and gentlemen.
05:20And let's hope that India can continue to be on track with it.
05:23And the numbers show that for now, with a 7.0 forecast, if it stays,
05:28that at least we are still in a good shape compared to as a GDP growth to other nations,
05:32and even American and European countries here.
05:36So we'll be tracking that and more.
05:38But if we continue to be in that dark horizon,
05:43a light, a spot of light, that was said by a bright spot on a dark horizon,
05:48as International Monetary Fund had said, this was in 2022,
05:52to be able to at least retain the position will also be significant.
05:58So we'll be discussing more.
06:00We are waiting for some clarity on that from our colleagues as well.
06:04But for now, this is the big update, ladies and gentlemen,
06:06that 7.0% is what the S&P Global has mentioned.
06:12Let's listen in to what Prime Minister Modi had said.
06:16This is, we are digging out from our archives on the issue of economy.
06:22Let's listen in to what the S&P Global has mentioned.
06:49This is, we are looking at the same level of the S&P Global.
06:59This is, we are looking at the same level of the S&P Global.
07:28We bring in my colleague Sakshi Batra from Business Today to help us understand this more.
07:32So, what do you think is the understanding here, Sakshi, that S&P is saying?
07:38And just break it down for us, because if there is this persistent inflation,
07:42there is clearly, as we can see, the Asia-Pacific economies have taken a setback.
07:46There is a war that is happening in several countries.
07:49What, according to then S&P Global ratings,
07:52is the reason that India is still in a good measure?
07:55And is 7.0 a good forecast?
07:57Absolutely, Walpooja, you do remember that just about some weeks ago,
08:02there was so much of debate around whether the 7.8% GDP growth figure for the first quarter
08:08is valid at all.
08:10Now, there are three global, you know, broking agencies
08:14highlighting that the economic growth activity back home in India is still resilient,
08:20despite all the global shocks that we have been facing,
08:22be it to the world, all the uncertainty with regards to the policies that Donald Trump
08:27has been bringing out to us, despite the fact that the crude oil prices are higher,
08:31that's elevating the inflationary aspect as well.
08:34The key aspect here is that the domestic consumption is very strong,
08:38our exports growth is very strong, and in-house industrial activity is also growing.
08:43Those are the three factors which all of these brokerage houses have highlighted
08:47as the key reason why they believe that India can still be among the faster growing
08:51major economies in the world, a 7% forecast coming in from two of them
08:55and a 6.9% forecast coming in by Fitch as well.
08:58This is definitely in line with most of the Indian, you know, aspects
09:02that are coming in from Indian economists as well.
09:05And in fact, that's why you are bringing some at least good news for us this morning
09:09and I hope that that continues.
09:10Appreciate you joining us on that.
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