Moody’s raises India’s growth forecast to 7.2% for 2024

India growth forecast: Moody’s Ratings has raised India's growth forecast for 2024 to 7.2 per cent.  The global ratings agency had earlier projected a growth forecast of 6.8 per cent for India. Moody’s has predicted a sharp increase in private consumption.

India’s economy is also expected to grow faster at 6.6 per cent in 2025, compared with 6.4 per cent projected earlier, the global ratings agency said on Thursday.

“Global growth is stabilising and inflation in most markets is close to central bank targets. We expect global growth will slow to 2.7 per cent and 2.5 per cent in 2024 and 2025, respectively, from 3.0 per cent in 2023, though growth trends differ across countries,” Moody’s said. The ratings agency has predicted no change to the global outlook.

Fitch retains India’s sovereign rating

Meanwhile, Global rating agency Fitch on Thursday affirmed India's sovereign rating at 'BBB-' with a stable outlook. The rating for India has remained unchanged at 'BBB-', the lowest investment grade, since August 2006.

"Fitch Ratings has affirmed India's Long-Term Foreign-Currency Issuer Default Rating (IDR) at 'BBB-' with a Stable Outlook," the global rating agency said in a statement.

India's ratings are supported by its strong medium-term growth outlook. This has continued to drive improvement in structural aspects of the country’s credit profile, including India's share of GDP in the global economy, as well as its solid external finance position, Fitch said in a statement.

Recent achievements in meeting deficit targets, improved transparency, and strong revenue growth have infused confidence in the government's fiscal credibility, suggesting that government debt may begin a gradual decline in the medium term. 

However, despite these positive developments, fiscal indicators still pose a challenge. Deficits, debt levels, and the burden of debt servicing remain elevated compared to peers in the 'BBB' rating category.

(With PTI inputs)