India's Per Capita GDP Set for Significant Rise Amid Economic Slowdown
The State Bank of India report forecasts a notable increase in per capita nominal GDP in FY25, despite slowed broader economic growth. Private consumption drives this growth, but concerns about sustainability arise as consumers dip into savings to maintain spending levels.

- Country:
- India
Amid a broader economic slowdown, India's per capita nominal GDP is slated to rise significantly by FY25, the State Bank of India (SBI) reported. According to the analysis, it is anticipated that per capita nominal GDP will be approximately Rs 35,000 higher than in FY23, despite sluggish overall GDP numbers.
The report indicates a remarkable growth in private consumption, which has emerged as a key economic driver, accelerating by 7.3% in real terms for FY25. Surprisingly, on a per capita basis, private consumption growth reached 6.3%, outpacing per capita GDP growth, which stood at 5.3%, suggesting a robust recovery in consumer spending habits.
However, the SBI report raises concerns about whether such consumption-driven growth is sustainable in the long term, particularly as households have resorted to depleting their savings to maintain their expenditure. It questions the viability of this trend continuing if savings continue to decrease, thus highlighting the tension in balancing consumption with savings.
(With inputs from agencies.)