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1. India's Macroeconomic Landscape in a Global Context

2. Introduction With a population of more than 1.4 billion, India is the world’s largest democracy. Over the past decade, the country’s integration into the global economy has been accompanied by economic growth. India has now emerged as a global player.

3. Gross Domestic Product 01

4. GDP “India’s GDP growth is likely to moderate from 8.2 percent in 2023 to 7 percent in 2024, and 6.5 percent in 2025 because the accumulated demand during covid has exhausted as the economy reconnects with it’s potential.” -IMF

5. Assessing India's GDP Growth The Indian economy continues to grow at a healthy pace despite challenging global conditions, according to World Bank’s latest India Development Update. The India Development Update (IDU) observes that India remained the fastest-growing major economy and grew at a rapid clip of 8.2 percent in FY23/24. Growth was boosted by public infrastructure investment and an upswing in household investments in real estate. On the supply side, it was supported by a buoyant manufacturing sector, which grew by 9.9 percent, and resilient services activity, which compensated for underperformance in agriculture. Reflecting these trends, urban unemployment has improved gradually since the pandemic, especially for female workers. Female urban unemployment fell to 8.5 percent in early FY24/25, although urban youth unemployment remained elevated at 17 percent. With a narrowing of the current account deficit and strong foreign portfolio investment inflows, foreign exchange reserves reached an all-time high of $670.1 billion in early August, equivalent to over 11 months oft cover (in FY23/24 import terms).

6. Growth bets GDP FY-25 forecasts (in%) IMF 7.0 S&P 6.8 World Bank 7.0 RBI 7.2 Moody’s Analytics 7.1 World Economic outlook projections for India (FY25 in %) Indicator Oct April Consumer Inflation 4.4 / 4.6 Current account deficit -1.1 / -1.4

7. Tax collection, borrowings 02

8. Tax Collection, borrowings India’s tax collections help fund important services like schools, hospitals, and roads, making life better for everyone. More tax money means the government can reduce debt, support job creation, and keep the economy stable. This extra funding also helps the government invest in programs for people in need, making growth more fair and sustainable. The provisional figures of Gross collection of Direct Taxes (before adjusting for refunds) for the Financial Year 2024-25 stand at Rs . 5,15,986 crore compared to Rs . 4,22,295 crore in the corresponding period of the preceding financial year, showing a growth of 22.19% over the collections of FY 2023-24. Gross market borrowings are estimated at ₹14.01 lakh crore and net market borrowings at ₹11.63 lakh crore during 2024-25.

9. In terms of percentage contribution to Gross Tax Revenue (GTR), the government has recently attempted to reduce the proportion of corporate tax (Figure 2). The percentage of corporate tax to GTR has decreased from 34.5% in 2014-15 to 26.6% in the 2024-35 budget estimates. On the other hand, the percentage of income taxes has increased from 20.8% to 30.9% in the same period.

10. Inflation Rate 03

11. Inflation Rates Inflation, or a rise in the general price level of goods and services, has long been a subject of concern and debate around the world. It affects everything from the cost of groceries and housing to the economy's overall health. As the nation gears up for the upcoming general elections, it becomes crucial to delve into inflation in India to better understand the country's economic situation. The annual inflation rate in India rose to 5.49% in September of 2024 from 3.65% in the previous month, well above market estimates of 5%. MOSPI statement says the rise in inflation rate for September 2024 is due to high base effect and weather conditions. The inflation is likely to settle down after the monsoon season and a growth is seen to be emerging.

12. Source-moneycontrol

13. Inflation Rate 04

14. Receipts Total receipts for FY25 are recorded at Rs.32.07 lakh crore. Total expenditure recorded at Rs.48.21 lakh crore and net tax receipts recorded at Rs.25.83 lakh crore in the financial year 2025, thereby resulting in fiscal deficit of 4.90% of GDP. The deficit is reducing as compared to last year which is a green signal. Corporate tax rates: 22% for existing domestic companies and 15% for certain new manufacturing companies. Tax buoyancy of state revenue increased from 0.72 (2012-16) to 1.22 in the post-GST period (2017-23), indicating enhanced revenue growth. An additional target of 2 crore houses has been set for the next 5 years, emphasizing the government's commitment to rural housing development. Installation of 1.3 crore LED street lights under the SNLP scheme to enhance energy efficiency The receipts are increasing when compared to last year, mainly due to the change is tax slabs previously which has made it easier for individuals to understand and pay tax. The budget targets a balanced approach to inflation and growth, ensuring that rising prices do not burden citizens and their income class increases.

15. Mutual fund industry 04

16. Mutual Fund Industry The mutual fund industry in India has experienced significant growth and development over the past few decades, emerging as a vital component of the financial landscape. One of the most positive aspects is the increasing awareness and participation of retail investors, which has led to a diversified investor base. The industry offers a range of investment options that cater to different risk appetites and financial goals, making it accessible for both novice and seasoned investors. The rise of digital platforms has further simplified the investment process, allowing for easier transactions and real-time monitoring of investments. Average Assets Under Management (AAUM) of Indian Mutual Fund Industry for the month of September 2024 stood at ₹ 68,00,486 crore. Assets Under Management (AUM) of Indian Mutual Fund Industry as on September 30, 2024 stood at ₹ 67,09,259 crore. The AUM of the Indian MF Industry has grown from ₹9.59 trillion as on September 30, 2014 to ₹67.09 trillion as on September 30, 2024 around 7 fold increase in a span of 10 years. The increase in investment shows trust in Indian capital markets and its expected growth.

17. Global Markets 04

18. Global Markets The latest World Economic Outlook reports stable but underwhelming global growth, with the balance of risks tilted to the downside. As monetary policy is eased amid continued disinflation, shifting gears is needed to ensure that fiscal policy is on a sustainable path and to rebuild fiscal buffers. Understanding the role of monetary policy in recent global disinflation, and the factors that influence the social acceptability of structural reforms, will be key to promoting stable and more rapid growth in the future.

19. Thanks

20. Resources PIB GOV Bloomberg IMF Moneycontrol RBI AMFI India