NEW DELHI: India’s economic growth is expected to accelerate in the third quarter (October-December 2024) compared to the first half (April-September 2024) of the current financial year, according to a report by ICRA report. The projection is supported by improved economic indicators and strong sectoral performance, with preliminary November 2024 data showing positive signs.
A rise in electricity demand has been observed due to a favourable base effect, while festive season activities have contributed to increased vehicle registrations.
“These trends reinforce ICRA’s expectations of a pick-up in the GDP growth in Q3 FY2025 as compared to H1 FY2025,” said the report.
Additionally, the report mentions substantial improvements in mobility and transport indicators. Vehicle registrations indicated a remarkable increase of 32.4 per cent year-on-year in October 2024, recovering from September 2024’s decline of 8.7 per cent.
Strong demand for two-wheelers and passenger vehicles drove this growth. Petrol consumption increased to 8.7 per cent from September’s 3.0 per cent, whilst domestic air passenger traffic rose to 9.6 per cent from 6.4 per cent.
Furthermore, two-wheeler production increased by 13.4 per cent, rail freight improved to 1.5 per cent from a previous decline of 0.7 per cent, and diesel consumption showed a slight increase of 0.1 per cent following September’s 1.9 per cent contraction.
The country’s non-oil exports demonstrated robust performance, with 25.6 per cent growth in October 2024, up from September’s 6.8 per cent. Electronic goods, engineering goods, chemicals, and readymade garments were significant contributors to this expansion.
ICRA’s Business Activity Monitor indicated a year-on-year growth of 10.1 per cent in October 2024, reaching an eight-month peak. This represents an improvement from September 2024’s 6.8 per cent growth, despite base effect challenges.
These positive trends across various sectors demonstrate India’s economic strength and suggest stronger GDP growth prospects ahead.
