Indian Economy Resilient Amid Global Uncertainties: RBI Report

The Reserve Bank's Financial Stability Report highlights a decline in banks' bad assets to a 12-year low and robust GDP growth. The Indian economy shows resilience amidst global uncertainties, with strong macroeconomic fundamentals and a stable financial system helping sustain growth momentum.

The Reserve Bank of India's latest Financial Stability Report reveals that banks' bad assets have decreased to a 12-year low of 2.8 percent, offering a significant boost to India's economic resilience. According to the report, the real GDP growth rate surged to 8.2 percent in 2023-24, compared to 7 percent in the previous fiscal year, despite challenging conditions such as muted consumption and external demand.

The gross non-performing assets (GNPA) ratio of scheduled commercial banks has fallen to 2.8 percent, with the net non-performing assets (NNPA) ratio dropping to 0.6 percent as of March 2024. The report projects the GNPA ratio could further improve to 2.5 percent by March 2025, aided by robust domestic demand, high business optimism, and increased government focus on capital expenditure.

The report also notes potential downside risks such as a global slowdown, geopolitical issues, and climate uncertainties. Nevertheless, the overall outlook remains positive, with the stable banking system and strong macroeconomic fundamentals expected to support continued growth. RBI Governor Shaktikanta Das emphasized the economy's strength and resilience in the foreword of the report, attributing steady economic activity to the vibrancy and stability of the financial system.

(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)