Key Points
Indian economys potential growth was revised upwards to 6.2% from 5.5% earlier by Fitch Ratings on Monday, given the improvements in employment rate and higher labour productivity..
In Indias case, potential growth has increased by 0.7pp to 6.2% given an improvement in the employment rate and a modest increase in the working-age population forecast..
However, despite the increases, Indias growth potential stays below the pre-pandemic level, with the cumulative shortfall in projected GDP level by 2027 to be 5.8% lower...
While the participation rate has recovered from its pandemic slump, it remains significantly below levels recorded in the early 2000s, partly as the employment rate among women remains very low, it said.. Indias female labour force participation improved to 27.8% in 2022-23 (July-June) from 24.8% in 2021-22, but the decline in unemployment was much slower for women than men..
The global rating agency expects Indias unemployment rate to remain unchanged but labour productivity to rise to 4.8% between 2019-2027 compared with 4.4% in the previous decade...
