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Drishtikone Report

Explore Brickwork Ratings' latest quarterly economic report (Drishtikone), offering a comprehensive analysis of India's macroeconomic outlook for 2026 and FY27. The report projects India’s real GDP growth at 6.8%–7.2% in FY27, reinforcing its position as the world’s fastest-growing major economy. It highlights India’s inflation trajectory, stabilizing at 2.1% in FY26- well within the RBI's tolerance band- and expected to remain in the 4%–5% range in FY27, supported by a benign crude oil price environment. This in-depth economic outlook covers key macro indicators, including the RBI repo rate forecast, fiscal deficit trends, debt-to-GDP ratio, PMI India, Index of Industrial Production (IIP), core sector growth, trade deficit movements, gold and copper price outlook, Nifty market forecast, and the broader financial market landscape. The report also provides strategic insights into India’s evolving trade architecture. It examines the India-EU Free Trade Agreement (FTA). Additionally, it analyzes the recent India-US interim trade deal, which reduces reciprocal tariffs on Indian goods from 25% to 18%.

India-US Trade Deal: Analysis & Implications

The India-US trade agreement acts as a significant economic stabilizer by capping reciprocal tariffs at 18%, averting punitive duties of up to 50% that threatened labour intensive sectors like textiles and leather. This rationalization restores export competitiveness, integrates MSMEs into global supply chains, and bolsters domestic aggregate demand through sustained employment. Structurally, the deal renews investor confidence, narrowing the Current account deficit by accelerating capital inflows (FDI/FPI).

RBI Monetary Policy Meet Outcome- February 2026

The Reserve Bank of India kept the repo rate unchanged at 5.25%, maintaining a neutral stance after cumulative cuts of 125 basis points over the past year. The RBI revised India’s FY26 GDP growth forecast upward to 7.4%, citing resilient domestic demand, strong credit growth, and supportive policy measures. Inflation was assessed as moderating, with supply-side improvements and stable core prices anchoring expectations. The central bank emphasized balancing growth momentum with inflation risks, while acknowledging that inflation dynamics have eased but remain sensitive to food prices, commodity volatility, and global uncertainties.

Monthly Economy Wrap

The Economic Survey 2025–26 projects India's real GDP growth at 7.4% in FY26 (GVA: 7.3%) and upgrades medium-term potential growth to 7% from 6.5%. Growth in FY27 is expected to moderate to 6.8 - 7.2%, supported by resilient domestic demand, robust investment momentum, and ongoing structural reforms such as PLI and GST. Public capital expenditure has been raised to INR 12.2 trillion for FY27 from INR 10.96 trillion (RE) in FY26, reinforcing the government's infrastructure-led growth strategy across transport, logistics, energy, and defence. while the fiscal deficit target of 4.3% of GDP signals a continued commitment to fiscal consolidation while sustaining growth support.

India's Union Budget 2026–27: Analysis

India's Union Budget 2026-27 underscores the government's dual focus on fiscal consolidation and revenue mobilisation, while maintaining support for growth and infrastructure. The fiscal deficit target has been set at 4.3% of GDP for FY27, signalling commitment to medium-term consolidation. Public capital expenditure rises to INR 12.2 lakh crore, up from prior years, targeting high-speed rail corridors, 20 new national waterways, and an Infrastructure Risk Fund for private investment. A major highlight is the ambitious disinvestment target of INR 80,000 crore, sharply higher than the FY26 revised estimate of around INR 33,800 crore

Banking Sector in India

Scheduled commercial banks continued to record double digit growth in deposits and credit in FY25 though growth moderated as compared to FY 24 amid cooling economic momentum. Banking sector remains resilient, stable, and well capitalized, positioned for steady FY26 expansion on the back of macro stability and digital inclusion

Monthly Economy Wrap

In a significant milestone, India has overtaken Japan to emerge as the world's fourth largest economy in nominal GDP, as highlighted in the government's year end economic review. This achievement is underpinned by a strong growth performance, with real GDP expanding by 8.2 percent in Q2 FY2026, the fastest pace in six quarters, driven by resilient domestic demand, prompting the government to revise its full year GDP growth forecast upward to 7.4 percent.

Monthly Economy Wrap

India's economy grew at its fastest pace in 18 months, expanding by 8.2% in the July–September quarter on the back of strong consumer demand and higher production as businesses ramped up output during the festive season, while the RBI's Monetary Policy Committee (MPC) has raised the GDP growth forecast for FY2025–26 to 7.3%, up from 6.8%, reflecting stronger-than-anticipated economic momentum

Drishtikone Report

India's economy delivered a robust performance in H1 FY2026, with Q2 GDP growth at 8.2% lifting first-half expansion to 8.0% and prompting an upward revision of the full-year real GDP forecast to 7.2%. India's economy entered Q3 FY2026 amidst a complex global backdrop marked by rising US tariffs, visa fee hikes impacting the IT sector, and significant domestic policy adjustments. On this backdrop, we expect real GDP growth to ease to 6.4% and 6.3% in Q3 and Q4 FY2026, respectively. GST cuts provide partial relief but are insufficient to fully offset trade-related headwinds.

From Disruption to Diversification: India's Path Through 100 Days of Tariff Shocks

The US imposed a 25% tariff on Indian exports effective August 7, 2025, which escalated to a 50% tariff on most goods from August 27, 2025. These tariffs target key Indian export industries, including textiles, gems and jewellery, marine products, and leather. The 100-day period of the US tariffs on India started on August 7, 2025. As of November 15, 2025, it marked 100 days since the tariffs came into effect. This 100-day period has seen significant export contraction, job losses in the affected sectors, and government efforts to mitigate the economic fallout.

Monthly Economy Wrap

India's GDP is projected to grow around 6.8% in FY 2026, driven by strong domestic demand, rising investments, and a robust services sector. However, global headwinds, manufacturing bottlenecks, and fiscal constraints could pose risks to sustaining this momentum.

Private Hospitals sector in India

The market size of India's hospital industry is projected to reach USD 202.5 billion by 2030. India's hospital sector is growing rapidly due to high demand, government support, private investment, and technological advances. The healthcare industry is attracting significant foreign direct investment and is likely to witness consolidation via mergers and acquisitions in order to scale operations and improve quality. Policy reforms and increased public health spending may likely enhance healthcare infrastructure and service delivery in the country.

Monthly Economy Wrap

The RBI has revised its real GDP growth projection for FY 2025–26 upward, from 6.5% to 6.8%. This upgrade reflects stronger economic momentum, underpinned by a revival in rural demand supported by a favorable monsoon, GST rationalization, and a sustained recovery in urban consumption and the services sector.

Pulp and paper industry in India

The market size of India's paper industry is projected to reach USD 19.1 billion by 2033. India's paper industry is one of the fastest growing globally. India produces 5% of the world's total paper and is currently the 15th largest paper producer globally. Paper consumption in India is expected to increase, driven by rising demand in packaging, e-commerce, FMCG, and the education sectors.

Monthly Economy Wrap

India's GDP expanded by 7.8% in the first quarter of FY2026, marking the highest growth rate in the past five quarters. This robust performance far exceeded economists' projections, which ranged between 6.5% and 6.7%. The strong growth comes despite global economic uncertainties and increased U.S. tariffs on Indian exports, underscoring the resilience of the Indian economy.

Monthly Economy Wrap

India's GDP is projected to grow 6.1% – 6.4% in FY2025–26, reflecting continued economic strength and impact of US Tariffs. FTAs with the UK and Japan in July 2025 have lowered tariffs, creating new export opportunities.

RBI Monetary Policy Meet Outcome – August 2025

RBI MPC decided unanimously to keep the policy repo rate unchanged at 5.50%, after having cut it by a total of 100 basis points since February 2025. This follows a 50-basis-point reduction in June 2025. The Repo rate stands at 5.50%, with the Standing Deposit Facility (SDF) rate at 5.25% and Marginal Standing Facility (MSF) and Bank Rate at 5.75%

Fortnightly Wrap

India's economy has tripled over the past decade, growing from Rs 106.57 lakh crore to Rs 331.03 lakh crore in 2024–25. With a 6.5% GDP growth and easing inflation, the country's strong domestic demand, stable investment, and global confidence are driving this momentum.

Weekly Wrap

The Indian economy is projected to grow between 6.4% and 6.7% in the current financial year, fueled by robust domestic demand, although geopolitical uncertainties continue to present potential downside risks, according to CII President Rajiv Memani.

ECONOMY OUTLOOK- JULY 2025

India's economic landscape in June 2025—a month that underscored the economy's robust fundamentals amid persistent global volatility. With GDP growth projected at 6.4% for FY 2025-26 (RBI, June 2025), India continues to outpace major emerging markets, driven by strategic policy interventions and resilient domestic demand

Weekly Wrap

India's economy is projected to grow 6.4% in the current fiscal year ending March 2026, according to a Reuters poll of 51 economists conducted from June 17-26. The Ministry of Finance stated that while India's macroeconomic conditions are in a “relatively goldilocks” phase, ongoing global uncertainties make this a period of “nervous but exciting times” for the economy

India FY25: Growth, Profits & Future Prospects

India Inc.'s FY25 performance showed resilience with record profits, sectoral outperformance in telecom, agriculture, and chemicals, and strong domestic demand. Despite moderate growth from post-pandemic highs, the medium- to long-term outlook remains positive due to macroeconomic stability, policy initiatives, and a revival in rural consumption.

Weekly Wrap

India's WPI inflation dropped to a 14-month low of 0.39% in May 2025, driven by easing prices of food, fuel, and primary articles, with core inflation also falling. While India's trade deficit narrowed to $21.88 bn in May 2025 from $26.42 bn, driven by lower oil prices and strong services exports.

Weekly Wrap

Hon'ble PM Narendra Modi and Cyprus President Nikos Christodoulides held a high-level business roundtable in Limassol, bringing together leaders from sectors like banking, manufacturing, defence, tech, AI, tourism.

Fragrance and Perfume Industry in India

The Indian perfume market was valued at USD 281 million in FY2024 and is expected to grow at a compound annual growth rate (CAGR) of 15.23%, reaching around USD 873.3 million by FY2032. India holds the position of the third-largest perfume market in the Asia-Pacific region, behind China and Japan. The Indian fragrance market is experiencing rapid growth, fueled by increasing disposable incomes, an expanding middle class, and evolving lifestyle preferences

Weekly Wrap

RBI delivered a larger-than-expected rate cut, lowering the repo rate to 5.5%. This marks a total reduction of 1% over three meetings. Governor Sanjay Malhotra said the move, along with a 100 basis point cut in the CRR ratio to 3%, aims to "frontload" support for economic growth.

ECONOMY OUTLOOK- JUNE 2025

India’s real GDP growth for the January–March 2025 quarter (Q4 FY25) accelerated to 7.4%, marking the fastest growth in four quarters and surpassing the Reserve Bank of India's (RBI) projection of 7.2% for the quarter. Nominal GDP saw a 10.8% increase, reaching ?88.18 lakh crore.

Weekly Wrap

India's economy grew by a robust 7.4% from January to March 2025 up from 6.2%, exceeding expectations, with strong performance in construction, public administration, defence and financial services sector. However, potential U.S. tariffs introduce uncertainty to the economic outlook.

Roads & Highway Sector India Market

India now boasts the second-largest road network globally, spanning over 66.71 lakh km as of January 2024, and aims to continue expanding, adding up to 13,000 km by 2025. From FY16 to FY24, National Highways expanded at a CAGR of 9.3%, with 12,349 km constructed in FY24 alone. The National Highways Authority of India (NHAI) allocated a record INR 2,07,000 crore in FY24, reflecting a 20% increase in capital expenditure compared to FY23.

Microfinance Sector in India

The Microfinance sector in India is playing a crucial role in financial inclusion and socio-economic development. Post-pandemic, the sector has seen a recovery, supported by regulatory clarity, digitization, and robust credit demand in semi-urban and rural areas. The sector is undergoing significant transformation in 2025 due to a growing regulatory framework, digitization, and a renewed policy focus on inclusive growth, aiming to provide credit and financial services to underserved and economically vulnerable populations in rural and semi-urban areas

Weekly Wrap

India has surpassed Japan to become the world's fourth-largest economy, with its GDP reaching USD 4.187 trillion, according to NITI Aayog CEO B.V.R. Subrahmanyam.

Weekly Wrap

India's retail inflation eased to 3.16% in April 2025 from 3.34% in March 2025, driven by a continued decline in food prices. This is the third straight month it has remained below the RBI's 4% target, beating economists' forecast of 3.27%

Weekly Wrap

Morningstar DBRS has upgraded India's issuer rating to BBB with a stable outlook from BBB-, highlighting the country's robust economic reforms and strong growth prospects, while anticipating minimal effects from regional geopolitical tensions.

ECONOMY OUTLOOK- MAY 2025

The inflation outlook for Q2-Q4 FY26 looks favourable due to strong rabi output, adequate buffer stock levels, and cooling global commodity prices. A high base from mid-2023 will support low YoY inflation. Policy transmission and monetary tightening help contain imported inflation. However, downside risks include monsoon uncertainty, crude oil volatility, and rising rural wages

Weekly Wrap

India's economy remains resilient and stable amid global uncertainties and trade disruptions, with key indicators signaling continued growth momentum in the final quarter of FY25, according to the Finance Ministry's Economic Review for March.

Weekly Wrap

RBI has projected a 6.5% growth for the Indian economy, with Governor Sanjay Malhotra encouraging U.S. industries to invest, emphasizing the opportunities available despite global uncertainties. To achieve its goal of becoming a developed nation by 2047, India needs to create a minimum of 8 million jobs each year and increase the contribution of manufacturing to its GDP over the next 10–12 years, according to CEA V. Anantha Nageswaran.

Dairy Industry in India

The Indian dairy market size stood at a value of Rs.18,975 billion in 2024. The market is set to grow at a CAGR of 12.35% between 2025 and 2033. India's dairy industry is the largest globally, accounting for 24% of global milk production. The Indian dairy industry is experiencing rapid growth, driven by the rising consumption of liquid milk and dairy products across the country, as well as the increasing demand from health-conscious consumers.

Weekly Wrap

India aspires to become a $10 trillion economy and attain developed nation status by 2047, as highlighted by Chief Economic Advisor V. Anantha Nageswaran. Meanwhile, RBI Governor Sanjay Malhotra noted that although the country shows strong economic resilience, it continues to face global headwinds, and its GDP growth remains below the ambitious targets set by the nation.

Weekly Wrap

RBI has cut the repo rate by 25 basis points to 6%, with the Monetary Policy Committee unanimously supporting the move to support economic growth. Alongside the rate cut, the RBI has lowered its GDP growth forecast for the current fiscal year, starting April 1, from 6.7% to 6.5%, citing concerns over potential tariff threats. Looking ahead, RBI expects inflation to ease to 4% in FY26, driven by favorable food prices, offering some relief to households amid persistent global uncertainties.

RBI Cuts Repo Rates Again By 25 Bps to 6%; Shifts Stance to 'Accommodative'

The Reserve Bank of India (RBI) cut the repo rate further by 25 basis points to 6% on April 9, 2025, marking its second consecutive rate cut to stimulate economic growth amid inflation, global trade tensions, and U.S. tariffs on Indian imports. This rate cut follows a 25 bps reduction in February 2025 (to 6.25%)- the first rate cut in nearly five years. The RBI also changed its monetary policy stance from neutral to accommodative, signaling openness to further rate cuts to counter growth risks

Weekly Wrap

India's commerce ministry is assessing the impact of the U.S. 26% reciprocal tariffs on imports. While the tariffs are considered a challenge, the government sees it as a mixed situation rather than a setback. Hon'ble Union Commerce and Industry Minister Piyush Goyal is expected to meet with exporters on Wednesday, April 9, to assess the challenges Indian traders will face due to the 26% reciprocal tariffs imposed by the Trump administration.

ECONOMY OUTLOOK- APRIL 2025

India's economic narrative for March 2025 unfolds against a backdrop of mixed signals. On one hand, the country's GDP growth has rebounded impressively to 6.2% year-on-year in the October-December quarter of FY25, marking a recovery from a seven-quarter low. This resurgence is largely attributed to robust private consumption and increased government spending.

Weekly Wrap

India's GDP is set to surpass Japan in 2025 and Germany by 2027, according to the IMF. Over the past decade, India's GDP has grown by 105%, increasing from $2.1 trillion in 2015 to $4.3 trillion in 2025. According to the Finance Ministry, trade tensions and financial market volatility are key risks to India's GDP growth in FY26. On the inflation front, the ministry anticipates food prices to stay stable, supported by projected agricultural production estimates.

Weekly Wrap

India's direct tax collections have increased by 16.15% year-on-year, totaling ?25.86 lakh crore in FY 2024-25. RBI's March bulletin points to rising global trade tensions and financial instability but emphasizes India's resilience, backed by robust agricultural performance and growing consumption.

Weekly Wrap

India's retail inflation dropped to a seven-month low of 3.61% in February 2025, compared to 4.31% in January, as the pressure from food prices eased. Industrial output rose by 5.0% in January, up from 3.5% in December 2024. The manufacturing sector saw a growth of 5.5%, compared to 3.6% in the previous month. Mining production experienced a small decline of 4.4%, while power output increased by 2.4%.

Weekly Wrap

India and the EU aim to finalize a free trade agreement by the end of the year. The EU is India's largest trade partner in goods, with trade reaching $137.5 billion in 2023-24, nearly doubling over the past decade, while US Commerce Secretary Lutnick calls for India to reduce tariffs, suggesting a potential grand deal.

ECONOMY OUTLOOK- MARCH 2025

The Indian economy saw a rebound in growth with GDP growing by 6.2% in Q3 FY2024-25 (October-December), accelerating from 5.4% in the previous quarter driven by increased rural consumption and higher government spending, though it was lower than the 9.5% growth in the same quarter of the previous year. Challenges remain, particularly in manufacturing and addressing urban demand sluggishness and global trade uncertainties is crucial, but overall growth momentum is expected to continue

India's Economy Rebounds Strongly in Q3FY25; GDP Growth Hits 6.2%

The Indian economy saw a rebound in growth with GDP growing by 6.2% in Q3 FY2024-25 (October-December), accelerating from 5.4% in the previous quarter driven by increased rural consumption and higher government spending, though it was lower than the 9.5% growth in the same quarter of the previous year. Challenges remain, particularly in manufacturing, but overall growth momentum is expected to continue.

Weekly Wrap

India's GDP growth increased to 6.2% in Q3 FY25, up from 5.6% (revised from 5.4%) in the previous quarter, driven by stronger rural consumption following a favorable monsoon and increased government spending. However, this growth is still lower than the 8.6% seen in the same quarter last year, and concerns about trade risks from potential tariffs under Trump continue to weigh on the outlook.

Weekly Wrap

India's economic activity is demonstrating consistent momentum, with high-frequency indicators signaling a continued growth pickup in the second half of fiscal year 2024-25. Key metrics such as vehicle sales, air traffic, steel consumption, and GST e-way bills indicate that economic activity is on course to sustain its upward trend, as per RBI bulletin.

Packaging Industry in India

India's packaging industry is a dynamic and rapidly evolving sector, reflecting the country's growing consumer market and industrial advancements. it spans a broad range of materials, formats, and applications across various industries. In FY 2024, the Indian packaging market was valued at INR 6656 billion, showing a growth rate of 4.0% from INR 6399 billion in FY 2023. Projections suggest that by FY 2028, the market could expand to INR 8,620 billion, growing at a CAGR of 6.7%. This growth is fueled by factors such as rising disposable incomes, urbanization, the increasing demand for packaged and processed goods, and the flourishing e-commerce sector.

Weekly Wrap

Prime Minister Narendra Modi and President Trump met to reinforce India-US relations. During the discussion, the Prime Minister stated that the two countries aim to double their bilateral trade to $500 billion by 2030. CII praised the results of Prime Minister Narendra Modi's visit to the U.S., calling it a significant milestone that will enhance bilateral trade, investment, defense, and technology collaborations.

Commercial Real Estate Industry in India

The commercial real estate market in India is projected to reach approximately USD 40.71 billion in 2024, and is likely to grow to USD 106.05 billion by 2029, reflecting a CAGR of 21.1%. This growth is being fueled by demand in office spaces, retail, warehousing, and the expanding co-working sector. The Indian commercial real estate market is undergoing a significant recovery, driven by promising growth opportunities and transformative trends. It is set for continued expansion in the coming years, supported by digital advancements, infrastructure development, government initiatives like Smart Cities and Make in India, and the rising adoption of PropTech solutions.

Weekly Wrap

The RBI has cut its benchmark interest rate for the first time in nearly five years in an effort to stimulate sluggish economic growth. The central bank lowered the repo rate by 0.25 percentage points to 6.25 percent. Finance Secretary Tuhin Kanta Pandey called on India Inc to show more "animal spirit" and ramp up investments, stressing that for India to become a developed nation, both the government and the private sector must collaborate as a unified team.

RBI Monetary Policy Meet Outcome- Cuts Repo Rate by 25 Bps

RBI Cuts Repo Rate by 25 Bps to 6.25% on February 7, 2025, marking the first policy decision under the chairmanship of the newly appointed RBI Governor, Sanjay Malhotra. This decision marked the sixth and final bi-monthly monetary policy review of FY25. Consequently, the standing deposit facility (SDF) rate adjusted to 6.00%, and the marginal standing facility (MSF) rate and the Bank Rate to 6.50%.

ECONOMY OUTLOOK- FEBRUARY 2025

The Economic Survey for the fiscal year 2025-26, presented by Finance Minister Nirmala Sitharaman on January 31, 2025, projects India's real GDP growth to be between 6.3% and 6.8%. This forecast reflects a significant slowdown compared to the previous year's robust growth of 8.2% in FY24, indicating challenges ahead for the Indian economy as it navigates through various headwinds

Food and Food Processing Industry in India

The food processing sector has emerged as a significant contributor to India's economy in recent years, fueled by forward-looking policy initiatives from the Ministry of Food Processing Industries and the Government of India. India's food processing market is projected to grow at a CAGR of 8% to 10% for the forecasted period between 2025 to 2029 with Tier-2 and Tier-3 cities emerging as key consumer markets for FMCG and Food processing businesses, closely mirroring consumption trends seen in metropolitan areas.

Outcome of India's Union Budget 2025-26: Analysis

India's Union Budget 2025-26, presented by Hon'ble Finance Minister Ms. Nirmala Sitharaman, emphasizes a growth-oriented approach through four key engines: Agriculture, MSMEs, Investment, and Exports, promoting inclusivity and resilience to stimulate economic growth. The budget outlines significant allocations and reforms aimed at stimulating economic growth and enhancing social welfare.

Weekly Wrap

India's economic survey forecasts GDP growth rate of 6.3-6.8 percent for 2025-26, driven by a robust external account, strategic fiscal consolidation, and steady private consumption. It also emphasized that domestic growth drivers will play a more significant role than external factors in the coming years for India's economy.

India's Union Budget 2025-26: Key Expectations

As India approaches the presentation of its Union Budget for the fiscal year 2025-26 on February 1, 2025, various sectors and stakeholders have articulated their expectations and recommendations. The Union Budget 2025 is expected to balance capital expenditure with consumption initiatives, focusing on infrastructure development, agriculture, and support for MSMEs, crucial for job creation and economic stability amid subdued economic momentum and global uncertainties.

Weekly Wrap

The RBI, in its monthly bulletin, stated that India's economic growth is set to recover as domestic demand strengthens. However, it highlighted the need for careful monitoring of the "stickiness" in food inflation.

Weekly Wrap

According to a World Bank report, India's fiscal deficit is expected to decrease, driven by higher tax revenues, indicating an improved fiscal position. With a projected GDP growth of 6.7% for FY26 and FY27, the services and manufacturing sectors are set to experience continued expansion. However, concerns persist regarding the government's debt-to-GDP ratios and elevated borrowing costs

Weekly Wrap

India's economy growth is expected to slow down in FY25 due to a significant downturn in the manufacturing sector, with the government's GDP forecast of 6.4% for the current fiscal year being lower than the RBI's 6.6% estimate. The upcoming Union Budget for India, scheduled for February 1, 2025, is viewed as a pivotal opportunity for India to foster sustainable growth, strengthen its taxation system.

India's GDP Growth Rate Estimates Slashed to 6.4% For FY25; Expect Rebound in H2FY25

India's Gross Domestic Product (GDP) is projected to grow by 6.4% for the financial year 2024-25, according to the First Advance Estimates released by the National Statistics Office (NSO). This marks a significant decrease from the 8.2% growth recorded in 2023-24 and marking the lowest rate since FY21, when the economy contracted due to the pandemic.

Weekly Wrap

India's economy is expected to grow by approximately 6.6% in FY25. This growth is attributed to a revival in both urban and rural demand, as structural growth drivers continue to support the economy, despite a recent slowdown. India's core sector growth reached a four-month high of 4.3% driven by increases in six of the eight core sectors.

ECONOMY OUTLOOK - JANUARY 2025

India's economy in December 2024 reflects a period of resilience and growth, positioning the country as a significant player on the global economic stage. The year has been marked by a projected GDP growth rate of 6.6% for the fiscal year 2024-25, continuing the momentum from previous years and reinforcing India's status as the world's fifth-largest economy.

Weekly Wrap

The Indian economy is showing signs of recovery from the slowdown observed in the Q2 of the fiscal year, driven by strong festive demand and continued growth in rural consumption. The Finance Ministry projects the Indian economy to grow at approximately 6.5% in the FY25.

Indian Auto Component Manufacturing Industry

The Indian auto component manufacturing industry, valued at $57 billion (bn) in 2023, is expected to grow to $85 bn by 2026, contributing significantly to employment and GDP. India's auto component industry experienced a 9.8% growth rate in fiscal 2023-24, with a turnover of around $73.1 billion. This growth is driven by steady vehicle production, a thriving aftermarket, and increased exports

Weekly Wrap

India's WPI based inflation in November 2024 dropped to a three-month low of 1.89%, down from 2.36% in October. This decline was primarily driven by lower prices of food items. The merchandise trade deficit reached a record USD 37.84 billion in November, driven by a rise in gold imports and a decline in exports due to falling crude oil prices.

Weekly Wrap

India's Index of Industrial Production increased by 3.5% in October, compared to 3.1% in September 2024. This growth was primarily fueled by strong performances in major sectors such as basic metals, electrical equipment and refined petroleum products while retail inflation decreased to 5.48% in November, down from 6.21% in October, as food prices showed signs of moderation.

Weekly Wrap

Chief Economic Advisor V Anantha Nageswaran stated that the Economic Survey forecasts Indias GDP growth to range between 6.5% and 7% for 2024-25, a decrease from the 8.2% growth recorded in the previous financial year

RBI Monetary Policy Meet Outcome – December 2024

RBI Keeps Repo Rate Unchanged at 6.5%; Cuts CRR by 50 bps to 4% and Lowers FY25 GDP Growth Projections to 6.6%. The Reserve Bank of India (RBI) has decided to maintain a steady repo rate of 6.5% due to rising inflation and slowing India’s GDP growth, which has reached a seven-quarter low of 5.4% for the July-September 2024 period

ECONOMY OUTLOOK - DECEMBER 2024

India’s recent economic performance has raised significant concerns, particularly following the announcement of a disappointing GDP growth rate of 5.4% for the second quarter of 2024, marking the slowest expansion in seven quarters. This decline is symptomatic of broader economic challenges facing the country.

Weekly Wrap

Indias GDP growth in Q2 FY25 slowed to a 7-quarter low of 5.4%, driven by a slump in the manufacturing sector. Manufacturing growth in Q2 decelerated to 2.2%, a sharp decline from 7% in Q1

Weekly Wrap

RBI Governor Shaktikanta Das stated that the Indian economy is well-equipped to manage any potential spillovers from global events

KEY TAKEAWAYS FROM RBI BULLETIN-NOVEMBER 2024

The Reserve Bank of Indias (RBI) November 2024 bulletin shows private consumption has regained its primary role as domestic demand driver, with festival spending boosting real activity in the third quarter. According to the RBI, private consumption is expected to improve due to favorable agricultural outlook and increased rural demand.

Weekly Wrap

Indias merchandise exports rose by 17.25% in October 2024, marking the fastest growth in 28 months

Drugs & Pharmaceuticals Industry - India Market

The Indian pharmaceutical industry is often referred to as the "Pharmacy of the World." Currently, it ranks as the third-largest pharmaceutical sector globally by volume, with a market size of approximately USD 65 billion (bn). Projections indicate it could expand to USD 120-130 bn (Rs. 9,84,000 to Rs. 10,66,000 crores) in the next decade, potentially increasing its contribution to the GDP by about 100 basis points.

Weekly Wrap

The U.S. Federal Reserve cut its key interest rate by a quarter-point to support the job market and maintain 2% inflation. Central bankers reassess rate-cut plans as Trumps return could stifle global growth and fuel US inflation

Power Generation – Renewable (Solar, Hydro, Bio, Wind) Sector in India

Indias power sector is diverse, generating power from conventional sources like coal, natural gas, oil, hydro, nuclear power, and non-conventional sources like wind, solar, agricultural, and domestic waste. Renewable energy capacity has grown significantly since 2014, reaching 90.76 GW and 47.36 GW as of September 2024.

IMPACT OF THE UNITED STATES PRESIDENTIAL ELECTIONS ON INDIA

Donald Trump has won the 2024 U.S. presidential election, marking a historic political comeback after his defeat in 2020. President Trumps win solidifies his influence within the Republican Party as he prepares for another term in office beginning January 20, 2025. Donald Trumps return to the presidency has significant implications for India across various sectors, based on his previous term and current policy positions.

ECONOMY OUTLOOK - NOVEMBER 2024

In September 2024, India experienced a surge in retail inflation due to rising food prices, particularly vegetables, and a fading base effect, raising concerns for consumers and policymakers as inflation exceeds the Reserve Banks target range.

E-Commerce Market in India

E-commerce, the online sale of tangible commodities, has significantly expanded corporate reach and sales potential, encompassing various industries and businesses with both physical and digital outlets. The Indian e-commerce market is expected to grow at a compound annual growth rate (CAGR) of 27% to reach $163 billion (bn) by 2026

RBI Monetary Policy Meet Outcome – October 2024

The Reserve Bank of India (RBI) has maintained its repo rate at 6.5% for the tenth consecutive time, following its MPC meeting on October 9, 2024, aimed at managing inflation and supporting economic growth.

ECONOMY OUTLOOK - OCTOBER 2024- Tax Reform: A Tyranny of Status Quo

The GST Council meetings have become routine meetings to tinker with some rates and minor changes in the administration as needed by the exigencies rather than transforming the tax structure towards the best practice approach.

Automotive Telematics Market in India

The automotive industry has seen significant technological advancements in the past two decades, including the integration of wireless communication and GNSS-based technology. The Indian telematics market is expected to experience a 46.8% growth from INR 555 Crores in 2021 to INR 3796 Crores by 2026, driven by government regulations and increased awareness.

Economy Outlook- September 2024-Onwards and Upwards: Marching Towards Viksit Bharat

After the noise and euphoria following the Union budget presentation, this is the time to take a filtered look at the medium and long-term strategies and policy interventions needed to make India a developed country.

Ferrous Metal-Iron and Steel Sector in India

India was the 2nd largest producer of crude steel with an output of over 144 million tonnes (MT) in 2023, showing a y-o-y growth of 11.8%, and accounted for 7.6% of world crude steel production. India crude steel production increased by 14.2% y-o-y in 2023-24 to 144 MT, while finished steel production reached 102.2 MT, up 14.1% y-o-y, a significant increase from the previous year

Indias GDP Growth Slows to 6.7% in Q1FY25; Lowest in Five Quarters

Indias Gross Domestic Product (GDP) growth in Q1 FY25 dropped to 6.7%, the lowest in five quarters, and below the Reserve Bank of Indias estimate of 7.1% for the same period. This marks a significant decline from 8.2% GDP growth recorded in Q1 FY24 and 7.8% in Q4 FY24

Pradhan Mantri Jan Dhan Yojana (PMJDY): A Decade of Success

The Pradhan Mantri Jan Dhan Yojana (PMJDY), which aims to connect underprivileged individuals with the banking system for financial inclusion, has reached a significant milestone as it has completed 10 years since its launch on August 28, 2014

Takeaways from RBI Bulletin-August 2024

The Reserve Bank of Indias August 2024 Bulletin highlights Indias economic resilience amidst global uncertainties and inflation challenges, with improved business sentiment, surging rural demand, and positive private capex outlook.

Indias CPI inflation eases sharply to 3.54% in July 2024, the lowest in nearly 5 years

Indias Consumer Price Index (CPI) inflation (retail inflation) fell to 3.54% in July 2024, the lowest in five years and below the Reserve Bank of Indias 4% target since September 2019. This figure represents a notable drop in inflation, attributed primarily to a sharp decline in vegetable prices

RBI Monetary Policy Meet Outcome – August 2024

The Reserve Bank of India (RBI) maintained its repo rate at 6.50%, in its monetary policy meeting on August 8, 2024, marking the ninth consecutive meeting where the benchmark rate remains unchanged. The RBI maintained GDP growth and inflation projections at 7.2% and 4.5% for FY25 amid normal monsoon expectations.

Economy Outlook- August 2024- Onwards and Upwards: Sprinting on Two Legs

The impressive growth performance since 2021-22 has placed India as the fifth-largest economy and it could become the third largest by 2028. Working out strategies and setting reform priorities to accelerate growth and create employment opportunities for those entering the workforce was, to some extent, done in the first budget of the Modi governments third term presented on July 23.

EDUCATION INDUSTRY IN INDIA

India boasts of one of the largest education systems with about 1.49 mn schools, 9.5 mn Number of Colleges in India teachers, and nearly 265 Mn students. Being the world’s most populous nation, India has a remarkable demographic advantage with a substantial youth population.

UK GDP Grew 0.4% in May 2024

The UK economy grew by 0.4% (estimated) in May 2024, a stronger performance compared to stagnant growth in April and a modest contraction in the third and fourth quarters of 2023

UNION BUDGET REPORT - 2024-2025

The much-awaited first budget of the Modi-3 government is on predicted lines. This is the seventh straight budget presented by the present Finance Minister. The budget attempts to set priorities for the long-term goal of achieving the developed-country status in the centenary year of independence.

US Inflation Cools in June, Falling 0.1% and Bolstering Case for Rate Cut

The annual inflation rate in the US as measured by the consumer price index (CPI) decreased to 3% in June, down from 3.3% in May, marking a significant slowdown in inflation from its peak of 9.1% in 2022, and bringing it closer to the Federal Reserve's 2% target.

RESIDENTIAL REAL-ESTATE SECTOR IN INDIA

The Indian real estate sector has witnessed significant expansion over the decades. This sector Market Size of Real Estate Sector in India ($ billion) has grown from a market size of $120 billion in 2017 to $477 billion in 2022 and the market size is estimated to be worth $1 trillion by 2030, largely led by the affordable housing scheme, according to real estate consultant Anarock and realtors body NAREDCO.

Economy Outlook- July 2024- Union Budget to drive the domestic economy in July

The 18th Lok Sabha elections are done and dusted, and The NDA coalition government has returned to power to rule the country for the next five years. The wild swings in the stock market as the results trickled in fearing the discontinuity and reform momentum too have settled to the reality that the BJP government must take the consensus route in calibrating policies.