India’s economic landscape appears resilient, supported by timely policy interventions such as tax cuts and rate reductions by the Reserve Bank of India (RBI), experts have affirmed.
The most recent figures show a steady improvement in industrial output, as evidenced by the 3 per cent rise in the Index of Industrial Production (IIP) for March, up from 2.9 per cent in February. These trends signal a recovery across several sectors, offering a positive outlook for the broader economy despite global challenges.The power sector, in particular, has displayed notable performance, with a robust 6.3 per cent growth. However, not all sectors have experienced this upward momentum. The mining sector showed more modest growth, at just 0.4 per cent, highlighting ongoing structural challenges within certain industries. Despite this, the positive growth in core sectors like infrastructure and construction, which recorded an 8.8 per cent increase in March, indicates a catch-up in government-led capital expenditure.
This shift suggests that fiscal measures are beginning to drive tangible economic benefits, with growth across critical infrastructure projects.Dharmakirti Joshi, Chief Economist at Crisil, noted that the upcoming fiscal year is expected to benefit from favourable external conditions, including a normal monsoon and lower crude oil prices. These factors will buffer India against potential global volatility, offering an additional layer of stability to the domestic economy. Furthermore, lower food inflation has contributed to improved consumer purchasing power, spurring demand in durable goods, which saw a significant recovery of 6.6 per cent in March, up from 3.7 per cent the previous month.
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While sectors such as textiles, machinery, and petroleum products saw a pick-up in growth, largely due to strategic frontloading of exports in anticipation of new tariffs, the export segment of computers and electronics delivered a remarkable 21.5 per cent increase, up from 11.2 per cent last year. This surge in exports points to India’s growing footprint in global technology markets, highlighting the increasing relevance of new-age industries within the economy.Industry expert Mahendra Patil, Founder of MP Financial Advisory Services, believes the IIP’s projected 4 per cent growth for FY25 reflects stability, even as industrial growth moderates.
According to Patil, the broader economy remains robust, albeit softer than the previous year, with stable core sectors, resilient tax revenues, and controlled inflation providing a strong foundation for growth in FY2026. Additionally, with inflation under control, the RBI may continue its accommodative stance, fostering further economic expansion as long as external uncertainties remain manageable.
India’s economic trajectory indicates that the nation is poised for steady growth, buoyed by strategic policy measures and expanding industrial output. While challenges persist in certain sectors, the government’s focus on infrastructure development, coupled with stabilising external factors, suggests a continued path towards economic resilience. The ongoing efforts to bolster industrial sectors, alongside careful fiscal management, reflect India’s adaptability in navigating both domestic and global challenges.As the economy adapts to these changes, the policies put in place today will set the stage for sustainable growth in the years ahead, ensuring that India remains on track to achieve its long-term economic goals.
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India Economic Growth Supported by Strong Policies
