First Advance Estimates (FAE) of National Income 2024-25 - An Overview

All eyes will be on the budget this years, as the expectations on many things are lurking around. Before going further, let us look at what the First Advance Estimates (FAE) of National Income 2024-25, released by the National Statistics Office, Ministry of Statistics and Programme Implementation (MoSPI).

It is pertinent to know how the economy is today, this will give the better understanding about what to expect from Budget. We will also look other real GDP estimates before going to what to expect from Union budget 2025-26.

First Advance Estimates (FAE) of National Income 2023-24

On 7^th January, 2024, NSO released the First Advance Estimates (FAE) of National Income 2024-25.

According to the press releases of MoSPI’s FAE, the Real GDP Growth rate is expected to witness a growth rate of 6.4% in the Financial Year (FY) 2024-25 compared to 8.2% of Provisional Estimate (PE) of GDP in FY 2023-24. In terms of Nominal GDP, India to witness a growth of 9.7% in FY 2024-25 over the growth rate of 9.6% in FY 2023-24.

The Gross Value Added (GVA) at basic prices (at constant prices) is has expected to witness a growth of 6.4% in FY 2024-25 compared to 7.2% in FY 2023-24. The Nominal GVA at basic prices is to witness at a growth rate of 9.3% in FY 2024-25 as compared to the growth rate of 8.5% in FY 2023-24

Net Domestic Product (NDP at constant prices) is expected a growth of 6.4% for 2024-25, compared to 8.3% in 2023-24. The Nominal NDP is expected at 9.7% for 2024-25 in comparison to 9.8% in 2023-24.

Private Final Consumption Expenditure (PFCE) at Constant Prices increased by 7.3% in FY 2024-25, compared to 4.0% percent in the previous year.

Government Final Consumption Expenditure (GFCE) at Constant Prices has recovered to a growth rate of 4.1% in FY2024-25 as compared to the growth rate of 2.5% in the previous fiscal year.

These are the major highlights of the First Advance Estimates of National Income 2024-25.

Other Estimates of Real GDP Growth

Real GDP growth is one of the best indicators, which tells how the economy is functioning.

The Reserve Bank of India projects real GDP growth of 6.6% for 2024–2025 in its Minutes of the Monetary Policy Committee Meeting, held from December 4–6, 2024.

According to the Asian Development Bank (ADB), India is India’s growth forecast is lowered to 6.5% for FY2024 (ending 31 March 2025) and 7.0% for FY2025. This is due to lower than expected growth rate in Q2, says ADB (Asian Development Outlook (ADO) December 2024),

On 9^th January, 2024, the United Nations released its UN World Economic Situation and Prospects (WESP) 2025 report. According to this “GDP in India is forecast to expand by 6.6 per cent in 2025, primarily supported by solid private consumption and investment growth.”

Organisation for Economic Co-operation and Development (OECD), in its   Economic Outlook 2024, which came out in December, 2024, projected that India’s real GDP in FY25 and FY26 at 6.8% and 6.9%, respectively.

India continues to emerge as the one of the fastest-growing economy in the world.

Conclusion/ My Perspective

The first good thing, which we see common in all estimate is India’s growth will be more than 6% for sure in the present and upcoming years.  Yes, six percent growth is not enough for India, but with the present global economic situation, still if we manage to hold more than 6.5% growth then definitely this is a good news. The second good thing is private consumption expenditure is started picking up this will result in crowding in (of private investments). We need to wait and watch how economy reacts when Union budget 2025-26 unfolds on 1 February 2025.

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