India remains a bright spot, economy expected to grow 6.7% in 2024: United Nations

NEW DELHI: India’s economy is expectedtogrowby6.7percentinthe calendar year 2024, supported by resilientdomesticdemand,according to a UN report which said higher interest rates and weaker external demand will continue to weigh on investment and exports this year for thecountry.

The World Economic Situation andProspectsasofmid-2023released on Tuesday said India’s economy, the largest in the South Asian region, is expected to expand by 5.8 per cent in 2023 and 6.7 per cent in 2024 (calendar year basis), supported by resilient domestic demand. However, higher interest rates and weaker external demand will continue to weigh on investment and exports in 2023,itsaid.

The flagship report issued in January had said that India’s GDP is projected to moderate to 5.8 per cent in 2023 as higher interest rates and global economic slowdown weigh on investment and exports. India’s economic growth is expected to remain“strong”evenasprospectsfor other South Asian nations “are more challenging.” India is projected to grow at 6.7 per cent in 2024, the fastest-growingmajoreconomyinthe world,theflagshipreporthadsaid.

Chief of the Global Economic Monitoring Branch, Economic Analysis and Policy Division, UN Department of Economic and Social Affairs, Hamid Rashid had said at a press conference that India is a “brightspot”intheworldeconomy.

The mid-year assessment said that prospects for a robust global economic recovery remain dim amid stubborn inflation, rising interest rates and heightened uncertainties. Instead, the world economy faces the risk of a prolonged period of low growth as the lingering effects of the COVID-19 pandemic, the everworseningimpactofclimatechange and macroeconomic structural challengesremainunaddressed.

According to the report, the world economy is now projected to grow by 2.3 per cent in 2023 (+0.4 percentage pointsfromtheJanuaryforecast)and 2.5 per cent in 2024 (-0.2 percentage points), a slight uptick in the global growth forecast for 2023.In the US, resilient household spending has prompted an upward revision of the growthforecastto1.1percentin2023. The European Union’s economy driven by lower gas prices and robust consumer spending is now projected to grow by 0.9 per cent, the reportsaid.