The Indian government has revised down its economic growth forecast for the current fiscal year to its lowest level since the start of the pandemic. This is due to a slowdown in both consumer spending and government investment. The Ministry of Statistics announced that the expected GDP growth for the year ending in March will be 6.4%. This is significantly lower than the 8.2% recorded in the previous fiscal year. The lower forecasts highlight growing concerns about a slowdown in one of the world's fastest-growing economies. This could be a challenge for Prime Minister Narendra Modi, who is seeking to implement ambitious plans to transform India into a developed economy and create jobs for the growing number of young professionals entering the labor market. In the current fiscal year, Indian consumers have reduced spending due to lower real incomes and high inflation, which negatively affected the profits of the country's largest retail companies. Consumer and business spending, which accounts for about 60% of GDP, has dropped significantly. Additionally, the slowdown in growth was facilitated by the fact that the government was unable to fully implement planned expenditures, partly due to prolonged elections, which limited economic activity.
