India Q1 GDP growth: India’s economic growth slowed to 6.7% year-on-year in the April-June quarter, falling short of the 6.8-7% GDP growth expected by most economists. The slowdown was attributed to reduced government spending during the national elections. However, India maintained its position as the fastest-growing major economy, outpacing China’s 4.7% growth in the same period.
Economists anticipate that the slowdown will be short-lived, as easing inflation and increased government spending are expected to bolster growth in the coming months.
The Gross Value Added (GVA), considered by economists to be a more reliable measure of growth, rose by 6.8% in April-June compared to the previous year, an improvement from the 6.3% recorded in the preceding quarter.

India Q1 GDP Data: Key Points

Dharmakirti Joshi, Chief Economist, CRISIL says that although overall private consumption shows mixed trends in the first quarter, initial signs of pick up in rural consumption are visible. We expect private consumption demand to improve this year over an anemic growth of 4% in fiscal 2024.
The low-base effect apart, improvement in agricultural growth and lower food inflation will augur well for private consumption, particularly in rural areas. Higher agricultural growth will augment income and lower food inflation will improve discretionary spending ability, he believes.
“In addition, government spending on employment and asset generating schemes (PM Awaas Yojna for urban and rural areas) can provide additional support to consumption growth in rest of the fiscal. That said, unlike last fiscal, rural consumption is expected to outpace urban, as higher interest rates impact urban areas more. The signs of this are visible in the Reserve Bank of India’s (RBI) consumer confidence survey released in August,” he said.
Upasna Bhardwaj, chief economist at Mumbai-based Kotak Mahindra Bank told Reuters, “We retain our GDP growth expectations of 6.9% in 2024/25, aided largely by rural demand and government spending while watching closely the likely fatigue in urban demand, private capex and pace of global slowdown.”
The Reserve Bank of India (RBI) projects the economy to grow by 7.2% for the full fiscal year, a decrease from the previous year’s 8.2% growth, due to a contraction in state spending and tightened rules on retail loans by the central bank.