The Asian Development Bank (ADB) has raised India’s growth forecast to 6.7 per cent for the current financial year from its earlier projection of 6.3 per cent on account of higher-than-expected second-quarter numbers.

The second quarter of FY24 saw GDP growth of 7.6 per cent, causing growth in the first half (April-September) to expand by a strong 7.7 per cent, according to the Asian Development Outlook December 2023 released on Wednesday.

Economic data also indicate that the industrial sector in particular, including manufacturing, mining, construction, and utilities, grew in double digits, it said.

“For FY24, agriculture is expected to grow slightly slower than expected, but this will be more than offset by industry’s much stronger-than-expected growth, hence the upward revision,” it said.

On the demand side, higher growth in fixed investment driven by increased capital spending by the central and state governments will compensate for lower growth in private consumption expenditure and weaker-than-expected exports.

Last week, the RBI too increased its growth estimate for FY24 to 7 per cent from its earlier projection of 6.5 per cent.

For FY25, ADB has kept its growth forecast unchanged at 6.7 per cent.