The Organisation for Economic Co-operation (OECD) has predicted that economic growth in the emerging market G20 economies, including India, will continue to remain stable. The report states that domestic demand growth in countries like India and Indonesia is expected to remain solid over the next two years. India’s GDP growth has been revised upward by 10 basis points to 6.7 per cent in 2024-25 and by 20 basis points to 6.8 per cent in 2025-26. Similarly, Indonesia is projected to grow by 5.1 per cent in 2024 and 5.2 per cent in 2025.
India’s GDP grew by 8.2 per cent during the financial year 2023-24, making it the fastest-growing major economy. In the previous years, the economy grew by 7.2 per cent in 2022-23 and 8.7 per cent in 2021-22. Various global rating agencies and multilateral organizations have also revised India’s growth forecasts upwards. China is expected to see growth supported by increased government spending and Brazil is anticipated to maintain solid economic momentum through the second half of 2024.
On the whole, many G20 countries, including the United States, Brazil, India, Indonesia, and the United Kingdom, have witnessed relatively robust growth. Aggregate consumer price inflation for the G20 economies is projected to decline significantly, aided by lower commodity prices and easing service price inflation. Headline inflation in the G20 is expected to decrease from 6.1 per cent in 2023 to 5.4 per cent in 2024 and to 3.3 per cent in 2025. Inflation in emerging-market economies is predicted to remain higher than in advanced economies but is expected to gradually ease.
The OECD report points out that inflation is likely to return to target levels in most G20 countries by the end of 2025. The report also discusses the factors contributing to economic growth and inflation in various countries. In China, growth is projected to be supported by increased government spending, despite challenges in the real estate sector and soft consumer confidence. Brazil’s economic momentum is attributed to higher fiscal spending, while many G20 countries are benefitting from robust growth.
Overall, the OECD report paints a positive picture of economic growth in the G20 economies, with countries like India and Indonesia expected to see solid domestic demand growth in the coming years. The report also highlights the importance of factors such as government spending, inflation, and consumer confidence in shaping the economic outlook for various countries. As global economic conditions continue to evolve, it will be crucial for policymakers to monitor these trends closely and respond effectively to support continued growth and stability in the G20 economies.
