March Economic Review: 'Consumer and investor confidence high', says Finance Ministry

The Ministry of Finance, in its economic review released for the month of March 2024, stated that consumer and investor confidence in India is “high”, despite the global headwinds. The country’s economy is resilient and has navigated through global shocks, it pointed out.

“India continues to exhibit robust economic performance. Factors such as strong domestic demand, rural demand pickup, robust investment, and sustained manufacturing momentum have contributed to India's resilience,” it said.

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The country’s deft tackling of inflation has also yielded results, as the consumer price index (CPI) inflation in March 2024, at 4.85%, is at its lowest in the last 10 months, the finance ministry noted.

Why consumer and investor confidence is high

• ‘Record-breaking stock market performance’

The confidence among consumers, as well as investors, is high due to the “buoyant domestic economic landscape” of India, the report released by the Finance Ministry suggested. This was reflected in the record-breaking performance logged by the stock markets during March, it stated.

“In March 2024, India's economy was marked by record-breaking stock market performance, remarkable GST collections, and substantial growth in the manufacturing and services sectors, reflecting a buoyant domestic economic landscape,” the report said.

The Nifty50, one of the prime indices, logged several highs during March and eventually peaked to an all-time of 22,765 points on April 9.

Meanwhile, the GST collection in March stood at ₹1.78 lakh crore, which was the second highest ever monthly collection. Year-on-year, it marked a surge of 11.5%.

• Strong growth prospects

According to the Finance Ministry, the confidence among consumers and investors has also been fuelled by the strong growth projections. According to the Reserve Bank of India (RBI), the momentum in the domestic economy is likely to continue, and the real GDP growth is likely to come in at 7% in the financial year 2024-25.

The World Economic Outlook, prepared by the International Monetary Fund (IMF), has also forecasted India’s growth at a high of 6.8% in 2024-25 and 6.5% in 2025- 26, based on its assessment of continuing strength in domestic demand and a rising working age population, the report said.

“The optimism regarding growth prospects is also reflected in consumer and investor perceptions,” the finance ministry added.

As per the latest consumer confidence survey, households’ sentiments on the general economic situation and employment prospects recorded notable improvements for both the current period as well as the upcoming year, it further noted.