India Economic Pulse

India Economic Pulse - economic indicators and policy measures decodes high frequency economic indicators and the direction of government thinking, to make them more relevant for businesses.

Join the conversation

#IndiaEconomicPulse

We are pleased to present the September 2024 edition of EY India Economic Pulse by our Tax and Economic Policy Group. This edition highlights India’s robust economic trajectory and resilience amid global trends. 

Key Highlights:

1. Stable Global Outlook: Global growth forecasts remain steady at 3.2%-3.3% for 2024-2025. Inflation and interest rates are generally on a downward trend, with a recent cut in US Fed interest rates by 0.5%.

2. India's Growth Trajectory: India is projected to grow at 7%-7.2% in FY 2025. The first quarter of FY2025 saw a 6.7% GDP growth year-on-year, slightly lower due to reduced government capital expenditure but still reflecting strong long-term growth drivers.

3. Consumption and Investment:

  • Consumption: Private Final Consumption Expenditure (PFCE) grew by 7.4% in Q1 FY 2025, with improved rural and urban demand driven by strong consumption patterns.
  • Investment: Gross Fixed Capital Formation grew by 7.5%, showing robust investment despite a reduction in central government capital spending. The construction sector saw notable growth at 10.5%.

4. Manufacturing Sector Performance: Manufacturing continues to grow well with a 7% growth in Q1 FY2025, supported by strong government push.

5. Macro-Economic Stability: Inflation has come down to 3.65%. The exchange rates and interest rates have been relatively stable. The fiscal deficit has significantly reduced from INR 6.1 lakh crores in April-July 2023 to INR 2.8 lakh crores in the same period for 2024. This reduction is driven by higher personal income tax revenues and controlled government expenditure.

6. Strong fund-raising environment: Stock markets are at record highs, and fund raising activities has surged. Mutual fund SIP contributions have doubled from June 2023 to June 2024, reflecting strong domestic investor confidence. FPI debt inflows remain positive, bolstered by the inclusion of Indian government bonds in key indices. Bank credit has grown 15%. 

7. Continued growth in service exports: Service exports have slightly surpassed non-oil merchandise exports, indicating a shift in export dynamics. This, along with improved net exports and strong remittances, contributes to economic resilience.

 Implementation of reforms, including enhancing ease of doing business, advancing energy transitions, and boosting manufacturing competitiveness, would support long-term economic expansion. 


Our latest thinking

BRICS+ to pave the way for a multipolar currency era

BRICS+ group's rising trade share challenges G7 dominance. Explore the shift towards a multipolar economic system and implications for global currencies.

Can BRICS+ play a key role in shaping future global economic policy

Explore the impact of G7 and BRICS+ on global economics, their power balance, and cooperation in shaping the world's financial future.

AI revolution: transforming the Tax landscape  

Rahul Patni & Divyesh Lapsiwala discuss GenAI's future in tax, its role in enhancing productivity, and evolving tax professions. Tune in now!

14m 22s

Incentive insights: decoding state incentives in Gujarat

Learn how to decode state incentives in Gujarat with EY's podcast. Unearth new insights & strategies. Listen today!

9m 51s

Budgeting for balancing growth and fiscal discipline

Discover how FY25 Interim budget has struck a fine balance between sustaining growth and achieving fiscal consolidation. Learn more.

Interim Budget 2024: impact on the macroeconomics of Indian economy

Explore EY's analysis of the Interim Budget 2024's impact on India's economy. Dive deep into macroeconomics! Listen now!

8m 39s

Interim Budget 2024: impact on individuals and India Inc.

Explore EY's deep dive into the Interim Budget 2024's impact on individuals and India Inc. Boost your financial literacy. Tune in now!

9m 56s

Interim Budget 2024: tax navigation, BEPS 2.0 and energy transition

Navigate tax, BEPS 2 and energy transition with EY's analysis on Interim Budget 2024. Enhance your understanding. Listen now!

10m 38s

How FY25 Budget can tackle fiscal imbalances and signal sustainability

Discover how the government should specify its fiscal consolidation strategy in the FY25 budget with a view to meeting the FRBM targets. Learn more about interim budget 2024.

16th Finance Commission: The benefits of brevity in Terms of Reference

The Terms of Reference (ToR) of the 16th Finance Commission provide it flexibility to define the scope of its work, approach and methodology. Learn more.

Incentives by States to bolster the growth of the tourism sector

Know about state incentives boosting India's tourism sector with EY. Decode complex strategies with ease. Start listening now!

8m 52s

How India’s FY25 interim budget could prepare ground for the main budget

Discover the groundwork laid by India's FY25 interim budget, shaping expectations for the main budget. Key insights on economic strategies and policies.

Budget 2023 and its impact on individuals 

In this podcast, Bhavesh Thakkar, Partner at EY India's Tax and Regulatory Services shares insights on the policy's coverage, eligibility criteria for incentives, and its unique approach toward incentivizing investments in emerging technologies.

12m 9s

Reaping the demographic dividend

Find out how size and age of workforce of India will play a significant role in its economic growth in the coming years. Learn more about the demographic dividend in India.

Fiscal consolidation in India: charting a credible glide path

Find out how a reduced fiscal deficit will help India make more investable resources available for the private sector. Learn more about fiscal consolidation in India.

How Budget 2023 has increased the attractiveness for IFSC, GIFT IFSC

Discover how GIFT (IFSC is expected to play a pivotal role in India’s growth journey. Learn more about Tax Incentives for IFSC Unit - GIFT IFSC

Union Budget 2023: strict clauses continue to challenge charitable institutions  

EY highlights the amendment in charitable trust. Learn more about the Charitable trust amendment in budget 2023.

Is the simplified new tax regime the right step to provide a better tax planning and tax payer experience?

EY highlights how Budget 2023 attempts to make the new concessional tax regime more attractive. Learn more about the new and old tax regimes.

How amendments in angel tax will impact companies

In Budget 2023, the scope of angel tax expanded, to cover foreign funding. Learn more about the amendments in angel tax.

KT Chandy + 1

Sunset clauses in India are truly setting

Sunset clauses are commonly utilised in tax and fiscal laws in India (like in tax holidays and regulations for exchange control). Learn more about the sunset clause in India

How India can fill the credit gap to fuel economic growth

Discover how debt has played a crucial role in driving economic growth. Learn more about credit gaps in India.

Digitalizing India: a force to reckon with

Discover how digitization in India and its adoption by people, provides India with a unique competitive advantage of not only reducing the cost of doing business.

How India is emerging as the world’s technology and services hub

Discover how India can become a technology hub in the world. Learn more about it in the latest report India@100.



    Contact us
    Like what you’ve seen? Get in touch to learn more.