India’s real GDP expanded by 7.6% y/y in 2QFY23-24 (Jul-Sep quarter), stronger than Bloomberg and UOB’s expectations for a 6.8% y/y increase but a tad lower than 1QFY23-24’s (Apr-Jun quarter) reading of 7.8% y/y.  

Outlook – We expect 3Q (Oct-Dec) GDP to be driven by strong year-end festival demand and ongoing public infrastructure spending. Private sector investments could pick up after the 18th Lok Sabha (lower house) elections (Apr-May 2024) as election uncertainty abates alongside continued progress of public infrastructure projects with the newly formed cabinet. We upgrade our FY23-24 GDP forecast to 6.9% (prev: 6.5%) and expect growth to moderate to 6.4% in FY24-25, as tight financial conditions gradually weigh on economic activity.