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Barclays Raises India's Growth Forecast to 7.8%, Buoyed by Strong Economic Data

Barclays has significantly revised its GDP growth forecast for India upwards, reflecting the country's impressive economic performance in recent quarters. Following the release of strong GDP data for the October-December 2023 period, Barclays has increased its growth projection for the entire fiscal year 2023-24 to 7.8%, representing a 110 basis point jump from their previous estimate.

This upward revision is attributed to the robust growth momentum observed throughout the first three quarters of 2023-24. With the current average growth hovering around 8.4%, Barclays acknowledges the potential for upward revisions in the future.

The bank's optimism extends into the next fiscal year, with their forecast for 2024-25 also experiencing a 50 basis point revision upwards, reaching 7%. This positive outlook stems from India's strong economic performance, which is expected to continue exceeding the growth rates of other major economies, solidifying its position as the world's fastest-growing major economy.

Barclays acknowledges the potential for a further boost to India's growth trajectory. With the implementation of the right policy mix, the bank believes India has the potential to achieve a GDP growth rate closer to 8% by the end of the decade, potentially becoming the largest contributor to global growth.

This revised forecast by Barclays aligns with the Indian government's own revised projection of 7.6% growth for the current fiscal year, surpassing their earlier estimate of 7.3%. This positive economic outlook strengthens India's position as a global leader in economic growth and provides a significant boost to Prime Minister Narendra Modi's campaign as he gears up for the upcoming elections.

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