The Indian economy could grow more than 7 per cent during the current fiscal amid a benign global outlook and expected above-normal monsoon, economic think tank NCAER has said.

In its April 2024 issue of Monthly Economic Review (MER), NCAER said a range of high-frequency indicators reveal the resilience of the domestic economy with the Purchasing Managers' Index (PMI) for manufacturing at a 16-year high and UPI, the leading digital payments system, touching the highest volume since its inception in 2016.

"Projected acceleration in both global growth and trade volumes, as well as a forecast of an above-normal monsoon, indicate that the Indian economy can again attain growth rates higher than 7 per cent during the current fiscal year," said NCAER Director General Poonam Gupta.

According to NCAER, Goods and Services Tax (GST) collections reached Rs 1.8 lakh crore in March, the second best since its rollout in 2017, while UPI recorded 13.4 billion transactions (in volume) in March 2024, the highest since its introduction, registering a growth of 55.3 per cent on a year-on-year basis.

"These high-frequency indicators, coupled with a more benign global outlook projected by the IMF and WTO bode well for the Indian economy during the current year," Gupta added.

According to the report, Consumer Price Index (CPI) headline inflation was down to 4.9 per cent in March from 5.1 per cent in February, while core inflation came down to 3.2 per cent during the same period.

The report said employment indicators again showed mixed trends, with an increase in the number of net new subscribers under the Employees' Provident Fund Organisation (EPFO) on a year-on-year basis.

However, the overall online hiring activities, as per the Naukri JobSpeak Index, moderated year-on-year, it added.

While the Asian Development Bank (ADB) and Fitch Ratings have estimated India's growth at 7 per cent, the International Monetary Fund (IMF), S&P Global Ratings and Morgan Stanley projected a 6.8 per cent growth rate for FY25.

The Monetary Policy Committee (MPC) decided to keep the policy rate unchanged at 6.5 per cent.

The Reserve Bank of India (RBI) kept projections for India's real Gross Domestic Product (GDP) growth for FY2024-25 at 7 per cent and Consumer Price Index (CPI) headline inflation at 4.5 per cent, in line with their previous projections.

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