American Invest Hub
  • Politics
  • Investing
  • Business
  • Latest News

American Invest Hub

  • Politics
  • Investing
  • Business
  • Latest News
Latest News

is India missing its demographic dividend? Slow growth raises concerns

by admin November 30, 2024
November 30, 2024
is India missing its demographic dividend? Slow growth raises concerns

India’s economic growth has decelerated to its slowest pace in almost two years, raising concerns about the nation’s overall economic outlook for the fiscal year ending March 2025.

The Statistics Ministry announced on Friday that the Gross Domestic Product (GDP) grew by 5.4% in the three months ending September 2024, marking the weakest performance since the fourth quarter of 2022.

This figure falls significantly short of the Reserve Bank of India’s (RBI) projection of 7% growth for the period.

The unexpected slowdown has prompted several investment banks, including Goldman Sachs, to revise their GDP growth forecasts downwards, with some predicting growth as low as 6.4% for the full fiscal year.

Pressure mounts on the Reserve Bank of India

The disappointing GDP figures place increased pressure on the RBI to consider a potential interest rate cut.

The central bank currently forecasts 7.2% growth for the entire year.

However, with the latest data indicating a weaker-than-expected performance, the possibility of a rate cut at the upcoming monetary policy decision on December 6th has become a topic of considerable discussion.

Sakshi Gupta, an economist at HDFC Bank Ltd., told Bloomberg, “While we expect the RBI to keep the policy rate unchanged at its meeting next week, the possibility of a move in the February policy for a rate cut has increased.”

The yield on India’s 10-year bond dropped 5 basis points to 6.76% following the GDP announcement, reflecting the market’s reaction to the slower-than-expected growth.

Underlying factors contributing to the economic slowdown

The decline in last quarter’s growth is largely attributed to weaker performance in key sectors.

Manufacturing, electricity and gas production experienced notable slowdowns, while the mining sector even contracted.

Several economic factors have contributed to this slowdown, including a slump in company profits, falling wages, and persistent inflationary pressures.

Despite these headwinds, the RBI has maintained its policy rate unchanged for nearly two years, with Governor Shaktikanta Das recently characterizing a rate cut at this juncture as “very risky” given the ongoing inflation concerns.

Political and social implications of slowing growth

The economic slowdown’s impact extends beyond purely financial concerns.

High borrowing costs, a point recently raised by prominent ministers in Prime Minister Narendra Modi’s government, including the finance minister, are hindering economic progress.

Furthermore, weak growth threatens India’s ability to fully leverage its demographic dividend.

The rising unemployment rate, particularly among young people, emerged as a major political concern during this year’s elections, contributing to the ruling party’s less-than-stellar performance at the polls.

The post is India missing its demographic dividend? Slow growth raises concerns appeared first on Invezz

0
FacebookTwitterGoogle +Pinterest
previous post
OPEC+ output cuts extended: a difficult decision amidst market uncertainty
next post
Tesla’s 33% November surge drives tech rally, lifting dow, S&P 500, and Nasdaq

Related Posts

Huge waves and high winds hurl jellyfish and...

February 8, 2024

Spanish region of Catalonia declares drought emergency

February 3, 2024

American man sentenced to 42 years in prison...

June 7, 2024

50,000 protest Georgia’s foreign agent bill as US sounds...

May 13, 2024

Israel war cabinet still debating how to respond...

April 16, 2024

Apple rallies as US tariff reprieve buys time...

April 15, 2025

Argentina once led on LGBTQ rights. After 4...

July 9, 2024

Julian Assange plans to swim ‘every day,’ sleep...

June 28, 2024

Inside Trump’s strategic Bitcoin reserve: A new era...

March 10, 2025

PolitiFi tokens tumble as Trump tariffs shake investor...

February 25, 2025

    Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Latest News

    • FBI raid on John Bolton’s home in Washington linked to classified documents

      August 25, 2025
    • Argentine senate deals blow to Milei’s austerity agenda with university budget boost

      August 25, 2025
    • Jackson Hole Symposium: what Powell said about economic effects of Trump’s tariffs

      August 25, 2025
    • At Jackson Hole, Fed Chair Powell signals possible cuts while warning of uncertainty

      August 25, 2025
    • Trump threatens to fire Fed Governor Lisa Cook amid mortgage fraud allegations

      August 25, 2025

    Categories

    • Business (3,763)
    • Investing (2,783)
    • Latest News (2,048)
    • Politics (1,530)
    • About us
    • Contact us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: americaninvesthub.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 americaninvesthub.com | All Rights Reserved