PTI mumbai

The Indian economy is exhibiting resilience and stability, and the gross domestic product (GDP) is projected to grow at 6.6% in 2024-25, aided by a revival in rural consumption, a pickup in government consumption and investment, and strong services exports, a RBI report said on Monday. 

The Reserve Bank has released the December 2024 issue of the FSR, which reflects the collective assessment of the Sub-Committee of the Financial Stability and Development Council (FSDC) on the resilience of the Indian financial system and risks to financial stability.

"The soundness of scheduled commercial banks (SCBs) has been bolstered by strong profitability, declining non-performing assets and adequate capital and liquidity buffers. RoA and RoE are at decadal highs, while the GNPA ratio has fallen to a multi-year low," the report said. 

It also said that macro stress tests demonstrate that most SCBs have adequate capital buffers relative to the regulatory minimum threshold even under adverse stress scenarios. Stress tests also validate the resilience of mutual funds and clearing corporations.

On the economy, FSR said during the first half of 2024-25, real GDP growth (y-o-y) moderated to 6% from 8.2% and 8.1% growth recorded during H1 and H2 of 2023-24, respectively.  "Despite this recent deceleration, structural growth drivers remain intact. Real GDP growth is expected to recover in Q3 and Q4 of 2024-25 supported by pick up in domestic drivers, mainly public consumption and investment, strong service exports and easy financial conditions," the RBI said.