India’s GDP growth to fall to six-quarter low of 6% in Q1 FY2025: ICRA

NEW DELHI : India’s Economic Growth in the first quarter of the current fiscal (Q1 FY25) is expected to slide on a year-on-year (YoY) basis.

Rating firm ICRA has projected the YoY expansion of the country’s GDP (gross domestic product) to moderate to a six-quarter low of 6.0% in Q1 FY2025 from 7.8% in Q4 FY2024, amidst a contraction in government capital expenditure and a dip in urban consumer confidence.

Moreover, ICRA notes that the growth in the gross value added (GVA) is estimated to ease to 5.7% in Q1 FY2025 from 6.3% in Q4 FY2024, driven by the industrial (to +6.4% from +8.4%) sector, along with a mild easing in the expansion in services (to +6.5% from +6.7%) and a slight pick-up in the agricultural GVA growth (to +1.0% from +0.6%).

“The gap between the GDP and the GVA growth is likely to moderate to ~30 basis points (bps) in Q1 FY2025 from 148 bps in the previous quarter. This is on account of an expected lower expansion in the net indirect taxes in Q1 owing to a turnaround in the subsidy outgo of the Government of India (GoI; +3.6% in Q1; -24.2% in Q4 FY2024),” ICRA added.